Claims Management Companies: Unwanted Text Messages

Monday 5th November 2012 Lords Chamber

Question

14:45

Asked By

[Lord Kennedy of Southwark]

To ask Her Majesty’s Government what action they are taking to ensure that people do not receive unwanted text messages from claims management companies.

[The Minister of State, Ministry of Justice (Lord McNally)]

My Lords, the Government fully support the work of the Information Commissioner’s Office in enforcing the legislation that protects individuals from unsolicited text messages. The Ministry of Justice’s claims management regulation unit is actively working with the commissioner to investigate individual claims management companies receiving leads or claims as a result of unsolicited text messages, and is taking enforcement action as appropriate.

[Lord Kennedy of Southwark]

My Lords, the mis-selling of payment protection insurance was an absolute scandal, but the activities of some claims management companies are also a scandal, with unwanted text messages and phone calls. Does the Minister agree that there is a serious problem with this industry? If so, what are the Government going to do about it?

[Lord McNally]

The Government are making sure that there are joined-up investigations, co-operation between the various bodies responsible for various aspects of the industry and carried-through enforcement action. This is feeding through into weeding out the rogue traders and making sure that the consumer has sufficient information to be able to make rational decisions as to whether they use the services offered.

[Baroness Gardner of Parkes]

My Lords, is the Minister aware that I have asked Questions several times of both this and the previous Government, not so much about texts but about unsolicited phone calls on exactly the same matter? I have been told that you can go on to a site and put yourself on a list, saying that you do not want to receive things. But, unfortunately, that does not really work. The latest statement that I had from the Government was that if things come through overseas channels or other satellite means, they cannot control it; they can control things only within certain parameters in this country. Is that still the case? I am getting about six phone calls a week and sometimes three or four a day, all offering me wonderful things.

[Lord McNally]

I have some sympathy for the point that the noble Baroness makes, because we at home are supposed to be on this blocking mechanism that you sign up for, but the calls still get through. I will investigate the point that she made about whether international calls get round the blocking. I know that Ofcom is very much aware of this problem. I know that it is no use me telling the noble Baroness that she can go on to this register and that Ofcom is on the job and so on, because from the noises around the Chamber and my own experience, I know that these nuisance calls are still getting through. I will contact Ofcom and write to the noble Baroness with the reply, which I shall put in the Library of the House.

[Lord Campbell-Savours]

My Lords, the Information Commissioner has received at least 10,000 complaints every year, but how many prosecutions have there been?

[Lord McNally]

If the noble Lord means complaints about the rogue calls, I do not know, because this Question is not about the rogue calls. In my letter, I will cover it. On the question of texts, the Information Commissioner has announced that he is preparing to levy some very heavy fines on people who abuse the system with texts. But I will make the question on unasked-for calls part of my inquiry and put the reply in the Library of the House.

[Baroness Butler-Sloss]

My Lords, would the Minister add e-mails? I get an enormous number of e-mails every day, generally about PPI but about a whole lot of other things, too. They all seem to be done at about three in the morning. E-mails are just as serious; I spend such a lot of time just deleting all these e-mails on a daily basis. Would the Minister add e-mails to texts and phone calls? I also get the texts and the phone calls.

[Lord McNally]

I agree; I know what absolute anger this matter causes. It sometimes raises a groan when Ministers announce the following, but a cross-industry working group has been set up led by the Direct Marketing Association and including the MoJ’s claims management regulator, the ICO, Ofcom, the Telephone Preference Service, the OFT and the Advertising Standards Authority. They are looking across the piece at what is undoubtedly a nuisance.

[Baroness Scott of Needham Market]

My Lords, I am sure the House is reassured to know that it takes so many people not to be able to do anything about this problem. Does my noble friend agree with me that the real problem here is the routine selling on of our personal data—our mobile phone numbers and our e-mail addresses—and that we might avoid this problem if we dealt with that and had severe punishments for breach of data protection?

[Lord McNally]

I thank my noble friend for that question. She is right. However, from April 2013, claims management companies will be banned from receiving referral fees in personal injury cases and from offering financial rewards or similar benefits as an inducement to make a claim. We are trying to make sure that we do not block legitimate activity but that we comb out and stop those who are causing a nuisance and the rogue traders. I am afraid that a number of regulators need to come together in this area to get effective action.

[Lord Skelmersdale]

My Lords, the Minister’s offer to put the letter in the Library is, of course, of great interest to Members of this House. However, there is much wider interest in this matter. May I encourage him to consider putting the letter in Hansard so that it can then get on to the internet and be much more widely read?

[Lord McNally]

I am not sure how easy it is to put it into Hansard, but what I can put into Hansard is the general advice on this matter, which is that customers should never use these firms. It is simple to make claims yourself and there is a template and letter on the Which? website. However, these claims companies have at least enabled financially less confident consumers to seek redress. I pay tribute to the noble Lord, Lord Kennedy, for his assiduity in pursuing these matters. I should also point out that the consortium of concerned bodies to which I referred has produced a very helpful pamphlet as a consumer guide entitled Nuisance Calls and Messages, which is supported by 11 bodies, which may be a clue as to why it is difficult to find a solution to this problem.