Regulators have dealt a blow for victims of nuisance phone calls by fining a claims management company £220,000.
The Hearing Clinic bombarded people with millions of nuisance calls asking them if they wanted to claim for Noise Induced Hearing Loss.
It becomes the first company to be penalised by the Claims Management Regulator under new powers.
Anthony McCarthy, a director of Macks Solicitors in Middlesbrough, said the decision underlines the importance of choosing trusted, expert solicitors to handle compensation claims.
“Like most people, I hate receiving cold calls,” he said. “I would strongly urge anyone who suffers an accident not to get involved with claims management firms and to ignore any cold calls or text messages you receive.
“Most of these firms lack the knowledge and experience of a firm of solicitors and are incapable of winning you the compensation you deserve.
“You should always instruct a qualified solicitor directly – preferably one who comes to you by personal recommendation from someone who knows they will do a good job for you.
“A trusted lawyer with detailed local knowledge of the area where your accident happened can be invaluable.
“Qualified solicitors have in-depth legal knowledge and are bound by codes of practice and the consumer charter, obliging them to seek the best possible outcome.”
Many of the Hearing Clinic victims had subscribed to the Telephone Preference Service (TPS), indicating they did not wish to receive such calls.
The government introduced new powers last December, enabling regulators to fine firms up to 20% of their annual turnover and suspend of remove their licences.
New figures show 296 claims firms received warnings from the regulator in 2014 to 2015 and 105 had their licences removed. The total number of companies in the industry has fallen from a peak of 3,367 in 2011 to 1,752.
The penalties are part of a raft of government measures designed to drive rogue firms out of the industry.
Other moves include banning companies from taking fees from customers before contracts are signed and naming firms that are under investigation or subject to enforcement action.
A ban on referral fees in personal injury cases came into force in April 2013. The number of claims firms registered to handle personal injury claims has fallen from around 2,300 in 2013 to just 959.
Anthony added: “This crackdown is long overdue but it’s encouraging to hear that it’s having an effect at last.”
Complaints about claims management companies providing poor service are handled by the Legal Ombudsman.
Claims Management Regulator Kevin Rousell said: “Companies should be in no doubt that if they break the rules then we won’t hesitate to fine them in addition to the tough action we already take.”
