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15/10/2015
Record Fine Over 'High Pressure Tactics' Used By PPI Firm
A Swansea-based company has been fined more than £500,000 for using "high pressure tactics" to get customers to make PPI claims.
The Claims Management Regulator (CMR) fined Rock Law Ltd £570,000 for coercing clients into signing contracts, without giving them enough time to understand the terms and conditions before taking unauthorised payments.
The record fine is the second to be issued in as many months by the regulator, based at the Ministry of Justice, and comes after the Government changed the law in December 2014 introducing financial penalties for firms found breaching the regulator’s rules of conduct.
Firms can now expect fines of up to 20% of their annual turnover, as well as having their trading licence suspended or removed.
Head of Claims Management Regulation Kevin Rousell said: "Our investigation showed that Rock Law Ltd were taking unauthorised payments which meant vulnerable people were at risk of being exploited. The size of this record fine demonstrates how seriously we take protecting the public from this exploitation.
"I hope firms that persist with poor practice take notice – If you break the rules you will have to pay."
An investigation by the regulator found that Rock Law Ltd had consistently infringed rules. Under those rules, companies are not allowed to take any payments from customers unless they have signed a written contract to work with them – so that people cannot be pressured into making agreements.
The fine is the latest in a series of moves by the government to clean up the industry. Since 2010 the regulator has removed the licences from over a thousand Claims Management Companies (CMCs), including 300 last year. Firms which are subject to investigation and enforcement action are now named online.
Justice Minister Lord Faulks said: "Claims management companies should be in no doubt that they must abide by the rules. There are no excuses.
"I want to make sure we’re doing all we can to protect consumers, get them a fairer deal and prevent their time being wasted by the rogue practices of some firms."
(MH/LM)
The Claims Management Regulator (CMR) fined Rock Law Ltd £570,000 for coercing clients into signing contracts, without giving them enough time to understand the terms and conditions before taking unauthorised payments.
The record fine is the second to be issued in as many months by the regulator, based at the Ministry of Justice, and comes after the Government changed the law in December 2014 introducing financial penalties for firms found breaching the regulator’s rules of conduct.
Firms can now expect fines of up to 20% of their annual turnover, as well as having their trading licence suspended or removed.
Head of Claims Management Regulation Kevin Rousell said: "Our investigation showed that Rock Law Ltd were taking unauthorised payments which meant vulnerable people were at risk of being exploited. The size of this record fine demonstrates how seriously we take protecting the public from this exploitation.
"I hope firms that persist with poor practice take notice – If you break the rules you will have to pay."
An investigation by the regulator found that Rock Law Ltd had consistently infringed rules. Under those rules, companies are not allowed to take any payments from customers unless they have signed a written contract to work with them – so that people cannot be pressured into making agreements.
The fine is the latest in a series of moves by the government to clean up the industry. Since 2010 the regulator has removed the licences from over a thousand Claims Management Companies (CMCs), including 300 last year. Firms which are subject to investigation and enforcement action are now named online.
Justice Minister Lord Faulks said: "Claims management companies should be in no doubt that they must abide by the rules. There are no excuses.
"I want to make sure we’re doing all we can to protect consumers, get them a fairer deal and prevent their time being wasted by the rogue practices of some firms."
(MH/LM)
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