A claims management company that used high-pressure tactics to get customers to make a PPI claim has been handed a record fine.
The Claims Management Regulator, run by the Ministry of Justice, today fined Swansea-based Rock Law Ltd almost £570,000.
The regulator said the firm had ‘coerced’ clients into signing contracts without giving them enough time to understand the terms and conditions, before taking unauthorised payments.
Following a change in the law in December 2014, firms can now be fined up to 20% of their annual turnover, as well as having their trading licence suspended or removed.
MoJ head of claims management regulation Kevin Rousell (pictured) said: ‘Our investigation showed that Rock Law Ltd were taking unauthorised payments which meant vulnerable people were at risk of being exploited.
‘The size of this record fine demonstrates how seriously we take protecting the public from this exploitation.’
According to regulations, companies are not allowed to take payments from customers unless they have signed a written contract to work with them.
Rock Law Ltd has now been ordered to record all calls with clients and prospective clients and retains those recordings for a minimum of six months. The company is not allowed to enter a legally binding contract with, or take payment details from, clients within 24 hours of the initial sales call.
Since 2010 the regulator has removed the licences from more than 1,000 CMCs, including 300 last year. Firms which are subject to investigation and enforcement action are now named online.