The Financial Conduct Authority has been cracking down on PPI claims companies that use unscrupulous tactics to promote their services. Other regulators have recently started penalizing firms that don’t comply with their guidelines. The Information Commissioner’s Office recently intervened when two companies were caught using persistent telemarketing practices to sell PPI claims services. The companies are both associated with one of the largest call centres in Wales and the United Kingdom.

PPI Claims

• ICO Fining Abusive Sales Practices

The ICO said that neither company verified whether or not the customers they contacted were registered with the Telephone Preference Service. Many of the customers had registered to prevent blocked calls and reported the claims companies when they made unsolicited phone calls.

The ICO said that it has looked into the allegations and ruled the allegations against them were true. Simon Entwisle is the ICO’s director of operations. Entwisle said the agency takes consumer privacy very seriously.

He said that many customers were actually amused by the absurdity of some of the calls. However, most customers were very irritated with them and have asked the ICO to address them.

• IPO Is Responding to Concerns

Two years ago Parliament gave the ICO the power to fine businesses that break any electronic privacy or communication laws. The regulator has been very aggressive in using this power since it was bestowed upon them. They have already imposed fines of nearly £800,000 on those that break them.

The largest company to be fined was DM Design in March. However, experts have indicated that many-a PPI claims company have been among the biggest offenders. The ICO will continue to penalize those that break electronic privacy laws.

• What Else Must Be Done?

Many experts are encouraged that the ICO is addressing these problems. However, they won’t be able to stop unsolicited calls on their own. Richard Lloyd, executive director of Which? said that the problem will need to be collectively addressed by various regulators and private companies. Imposing fines on violators is an important first step, but other things will need to be done.

Lloyd said that the government will need to play an active role in fighting the epidemic. He also said that telecommunications firms will need to help develop the technology needed to help prevent these types of tactics. Lloyd said that these problems have grown in recent years, but they can probably be deterred.

Helpful Resources:

http://en.wikipedia.org/wiki/Payment_protection_insurance

This entry was posted on Thursday, August 29th, 2013 at 6:18 pm and is filed under Personal Finance. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.