Duncan Lewis


Asylum, Detention/ Fast Track

Managed Migration, Public Law

Claims management companies being reined in by the Ministry of Justice

Date: (3 January 2013)    |    

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After a major crackdown by the Claims Management Regulations Unit at the Ministry of Justice, 352 claims management companies (CMCs) were shut down, suspended or warned for bad practices.
This included 209 companies that were shut down and their licenses cancelled. Another three CMCs were suspended and 140 were warned.
The Regulation Unit has taken a tough stance on CMCs which didn’t kept on their promises to the customers either through bad service, misleading marketing or hidden charges.
The government has planned to give consumers even more protection against rogue firms, includes making all businesses agree written contracts with customers before taking fees. Other plans include an independent consumer complaints service which can compensate those who have received a raw deal.
Justice Minister Helen Grant said that ripping off of consumers and flouting of rules by claims management companies were not going to be tolerated and by shutting off 350 CMCs the government meant business.
She added that the government had introduced a number of measures in the past year which would mean consumers were much better protected and which offered a route of complaint and compensation while sending a clear message to the minority who broke rules that it won’t be tolerated.
Head of the Claims Management Regulation Unit, Kevin Rousell, added that they would continue to tackle bad practices by claims management companies and take action against those who break the rules.
He added that in the past five years they had shut down more than 900 claims management companies and were continuing to work with the Information Commissioner's Office to ensure firms who broke the law on unsolicited calls and texts were dealt with.