Panacea comment for Financial Advisers and Paraplanners
23 Feb 2018
For those of you who remember the Mel Brooks classic ‘Blazing Saddles,’ the town of Rock Ridge was being held to ransom by out of control Mexican bandits who proudly proclaim to the Mayor, Hedley Lamarr, that in a town with no sheriff, to cause havoc they “don’t need no stinking badges”.
So fast forward to the 21st Century where Rock Ridge is now ‘policed’ by the new bandits in town- Claims Management Companies (CMC’s)
Wheels turn slowly, but those who recall our campaign, with Alan Lakey, on the regulation of CMC’s will note some very positive ‘outcomes’ after a number of meetings with Kevin Rousell, Head of Claims Management Regulation Unit at the Ministry of Justice.
Kevin recently let me know that the House of Commons was working on the FINANCIAL GUIDANCE AND CLAIMS BILL [LORDS] Public Bill Committee: 25 January 2018.
In ‘Blazing Saddles’ parlance, Bart has just ridden into town.
There is an amendment which inserts a provision into the upcoming Privacy and Electronic Communications (EC Directive) Regulations which prohibits live unsolicited telephone calls for the purposes of direct marketing in relation to claims management services except where the person called has given prior consent to receiving such calls.
Do read the whole bill but in particular section N6 which states:
Financial Guidance and Claims Bill-[Lords], continued
After regulation 21 insert—
“21A Calls for direct marketing of claims management services
- (1) A person must not use, or instigate the use of, a public electronic communications service to make unsolicited calls for the purposes of direct marketing in relation to claims management services except in the circumstances referred to in paragraph (2).
- (2) Those circumstances are where the called line is that of a subscriber who has previously notified the caller that for the time being the subscriber consents to such calls being made by, or at the instigation of, the caller on that line.
- (3) A subscriber must not permit the subscriber’s line to be used in contravention of paragraph (1).
- (4) In this regulation, “claims management services” means the following services in relation to the making of a claim—
- (a) advice;
- (b) financial services or assistance;
- (c) acting on behalf of, or representing, a person;
- (d) the referral or introduction of one person to another;
- (e) the making of inquiries.
- (5) In paragraph (4), “claim” means a claim for compensation, restitution, repayment or any other remedy or relief in respect of loss or damage or in respect of an obligation, whether the claim is made or could be made—
(a) by way of legal proceedings,
(b) in accordance with a scheme of regulation (whether voluntary or compulsory), or
(c) in pursuance of a voluntary undertaking.”
Readers may wish to refer to “Stinking badges 2” from August 2016.
It is well documented how claims management companies have plagued this industry in recent years. Many of these have lied, cheated, deceived and generally operated in a base and underhand manner.
Alan noted “The Ministry of Justice unit at Burton on Trent had been unable to deal with the excesses in a sensible manner and when foul behaviour has been determined the response is often the equivalent of a slapped wrist and a bad telling off.
Hopefully this bill will sound the death knell at long last for this legally assisted parasite that feeds off the world of financial services.