Rogue claims companies that provide bad service and bombard people with nuisance calls face fines totalling hundreds of thousands of pounds under new plans.
Those who use information gathered by unlawful unsolicited calls and texts, waste people’s time and money by making spurious claims or use misleading marketing could be fined up to 20 per cent of their annual turnover, justice minister Lord Faulks said.
Fines will be based on the turnover of the company and the nature of the offences.
Lord Faulks said: “No longer should claims companies be able to plague hardworking people and waste everyone’s time.
“The scale of these fines shows just how serious we are about stopping them.
“This is also good news for the reputable firms in this industry, as it will boost confidence in the services provided by the sector.”
The fines, due to be introduced later this year, will be brought against companies which break rules set by the Claims Management Regulation (CMR) unit at the Ministry of Justice (MoJ).
CMR head Kevin Rousell said: “Again and again we have seen examples of bad practice from claims management companies (CMCs) that continue to plague the claims industry and bother the public.
“We already take tough action against companies which break the rules, but now these fines will help to drive malpractice out of the industry.”