Consumers deserve to be protected from cold calling

This article first appeared in Modern Claims Magazine, Issue 23, January 2017

Consumers deserve to be protected from cold callingThere have been several recent and welcome initiatives aimed at tackling the problem of cold calling. Action and publicity to encourage higher levels of reporting of cold calls can only contribute to improved investigation and enforcement by the regulators. Equally, higher and more robust fines, targeted at individuals rather than companies, may put some of the worst offenders out of business and deter others.

Cold calls are at the root of many of the sector’s problems. They have encouraged more claims than there would otherwise have been, resulting in one of the Government’s main arguments for its proposed changes to the claims process. Suspiciously sourced claims are more likely to be fraudulent or exaggerated. They daily assault of cold calls and texts faced by many people has contributed to the poor reputation of the sector amongst the general public.

MASS, along with other representative bodies in the sector, have long called for a complete ban on unsolicited cold calls and texts. Our hope is that once the Financial Conduct Authority takes full responsibility for the regulation of CMCs around April 2019, it has the political support to use its greater powers to completely bad cold calls in personal injury, as it has done in pension selling and mortgage broking. If it can be done in some areas of financial services, it can be done in PI once CMCs fall within its regulatory umbrella.

However, we recognise that even if a ban was implemented, nuisance calls, perhaps the majority, would still be made from unregulated, illegal outfits, either here or offshore. A further issue is a crooked practice that takes place beneath the surface. Personal data used for cold calls is mined, sold and re-sold by a variety of organisations across the personal injury sector. CMCs are not alone in this practice. Insurers, price comparison websites, garages, car hire companies, towing companies and marketing/survey companies must all be held accountable.

So too must solicitors. We have long been banned from making unsolicited texts and calls, but clearly there are some who are either negligent or willfully failing to carry out due diligence to ensure that a claim is genuine and that the lead comes from a legitimate and reputable source. The SRA, professional and representative bodies and individual firms and solicitors must all play their role, reporting those who introduce bad leads or punishing those who recklessly pursue suspect leads. It is long overdue, but it really is time to protect consumers and their data from this insidious practice.

Simon Stanfield, is MASS Chair and a Partner at Simpson Millar

 


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