Call to ban claims management calls
Most people want nuisance calls from claims management companies (CMCs) to be made illegal, a new report has found.
Nearly two thirds (64%) said firms offering to seek compensation for personal injury or financial products, such as mis-sold payment protection insurance, should be banned from bombarding people with messages, according to the poll.
More than 80% said they wanted to see telemarketing companies which contact people on behalf of CMCs to be more closely regulated and face fines for abusing distribution laws, the study by Axa insurance company found.
Axa said the research highlighted "the severe emotional impact" of tactics used by CMCs and showed the extent "people feel powerless to stop these communications".
The poll of more than 2,000 people found nearly two thirds (63%) said they felt "angry" after being contacted by CMCs, while the same percentage said it was an "invasion of their privacy".
Just under half (45%) said they were worried about how CMCs had access to their contact details.
Only 2% of people said they welcomed communication from CMCs, while 44% of people said they were proactively trying to stop unwanted contact.
However only 6% had managed to stop the unwanted calls, texts or emails, according to the poll, carried out by research firm Populus.
Nearly 60% said they had seen no change in the number of communications despite a Government clampdown on spam communications last year, while 13% said they had actually seen an increase.
The study found 16% do not reply to text messages or answer calls because they fear that interaction with CMCs will lead to greater volumes of communications.
Nearly one in five (19%) of those questioned said they had been contacted by a CMC in the last 24 hours, while around a quarter (23%) claimed to have been contacted in the last week
The Axa report, to be published in full this week, is calling for a change in the law so the number of calls a company must make before a penalty is enforced is in the hundreds rather than thousands.
Reporting complaints to Ofcom should be simplified, while the regulator should have the power to shut down companies that persistently flout privacy regulation, Axa said.
The maximum fine telemarketing companies should face should increase from £500,000 to £1 million, the company said.
All CMCs should reveal their caller ID and publish annual records detailing how consumers' phone numbers have been sourced, it added.
David Fisher, Axa UK's claims expert, said: "It would appear that CMCs are taking advantage of a consumer lack of confidence in the system when claiming compensation for mis-selling.
"However, this research shows that not only do the vast majority react negatively to contact with CMCs, but of the 12% that pursued a claim, only half were successful, suggesting that the CMC route is not particularly effective.
"It is time for the Ministry of Justice's claims management regulation unit to address these spamming tactics so that the CMCs' endless search for growth does not continue to significantly impact consumers and unnecessarily invade the privacy of thousands of people every day."
Professor Christopher Parsons, from Cass Business School in London, said: "The persistence of CMC communications is evident and respondents indicate a strong sense of powerlessness to stop it.
"Recent government intervention to regulate CMCs does not seem to have had a sufficiently significant effect on respondents' perception of unsolicited contact.
"All unsolicited marketing is generally disliked, but CMCs operate in territory that often feels 'personal' and is therefore potentially more upsetting and stressful for the targeted individual.
"Large numbers of respondents said they felt anger and that their privacy was being invaded."
Justice minister Shailesh Vara said: "We will not tolerate companies which waste hard-working people's time and money through their own laziness, incompetence or frankly dubious practices.
"We are already making sure rogue companies are shut down - and now we are ensuring those who are wasting everyone's time will pay for it."