The Government has stepped up the fight against nuisance callers by announcing that, from April 2017, the Information Commissioner will have the power to impose fines on individual company directors.
The Commissioner currently has the power to fine companies up to £500,000 should they breach the Privacy and Electronic Communications Regulations (PECR) in a way that causes annoyance or inconvenience to the recipients. However, there have been reports of directors choosing to close down their firm in order to avoid the fine, before then starting up again as a new entity. Of the £2.7 million imposed in fines to date, only £340,000 has been recovered from the firms in question, and 15 of the 20 firms fined subsequently declared themselves insolvent.
This move is aimed at closing this loophole by making the individual directors pay the fine, as opposed to their firm.
There is also an issue at present whereby if a larger firm is fined, shareholders and management may be different entities. Hence if a fine is imposed that reduces company profits, the shareholders will suffer more than the management who were actually responsible for breaking the law.
The power to fine firms will remain in force, so it is possible that the Commissioner could impose a penalty of £1 million or more for the same offence – £500,000 each to be paid by one or more directors and a further £500,000 by the firm.
Announcing the proposals, Minister of State for Digital and Culture Matt Hancock MP, said:
“Nuisance callers are a blight on society, causing significant distress to elderly and vulnerable people. We have been clear that we will not stand for this continued harassment, and this latest amendment to the law will strike another blow to those businesses and company bosses responsible.”
Information Commissioner Elizabeth Denham said:
“The people running nuisance call companies have little regard for the anxiety and upset they cause all in the name of turning a fast profit.
“We are inundated with complaints from people who are left shaken and distressed by the intrusion on their daily lives.
“We’re quick to fine the companies responsible, but we’ve been speaking to the government about going further than that because we must do all we can to help protect people from these calls.
“Making directors responsible will stop them ducking away from fines by putting their company into liquidation. It will stop them leaving by the back door as the regulator comes through the front door.”
Under PECR, directors and firms may for example be liable for fines if they make live marketing calls to individuals registered with the Telephone Preference Service, or they send unsolicited texts to consumers who have not explicitly consented to receiving them.
The information shown in this article was correct at the time of publication. Articles are not routinely reviewed and as such are not updated. Please be aware the facts, circumstances or legal position may change after publication of the article.