MoJ: 100 claims management firms banned and counting

MoJ: 100 claims management firms banned and counting


Following the announcement that 100 claims management companies have had their authorisation cancelled since April 2007, the Ministry of Justice has warned that they will continue to take strong action against firms flouting the rules.

Since new regulations came into force in 2007 to control the sector, businesses have been banned for a number of reasons, such as continually making misleading marketing statements, ignoring requests for information from the MoJ, failure to pay fees and criminal conviction for fraud.


Although the Ministry of Justice has stated that the majority of registered claims management companies operate within the rules, some are choosing to disregard them and target vulnerable, indebted consumers.


Kevin Roussell, Head of Regulation at the Ministry of Justice warned: “People may have paid large up-front fees for a service that doesn’t live up to the marketing hype, and in the case of debt-related claims find themselves still liable to pay all their debts in full. There has also been a trend towards high pressure cold calling from call centres, including making unsubstantiated claims and encouraging people into handing over fees there and then – a decision they regret later.


“It is important that consumers make fully informed choices about whether to make a claim and whether to use the services of the company that has approached them. Consumers must be given clear information about the options available for pursuing their claim, realistic chances of success and the costs of doing so.”


Mr Roussell added: “One hundred companies cancelled so far sends a strong message that if consumers aren’t treated fairly, there will be consequences for the companies. We will be continuing to step up the strong action needed to deal with those claims management companies found be disregarding the rules and the interests of the public.”

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