17Nov

London-based loan matching company Nouveau Finance Ltd has been fined £70,000 by data protection watchdog the Information Commissioner’s Office after sending some 2.2 million illegal marketing text messages over a six-month period. The firm has also been issued with a Stop Now order, meaning it could face criminal prosecution if it continues to engage in the illegal practice. The fine will be reduced to £56,000 if prompt payment is made.

Like so many firms fined by the ICO in recent months and years, Nouveau attempted to shift the blame to a third party marketing firm who sent the texts on their behalf. However, the ICO will never be persuaded by any such argument, as all firms who use third parties are required to conduct checks to ensure that the other party’s marketing activities are compliant with relevant legislation.

The text messages sent on behalf of Nouveau were not only unsolicited, but also failed to comply with the requirement to identify the sender within the message.

Section 22 of the Privacy and Electronic Communications Regulations says marketing texts can only be sent to individuals who have previously given explicit consent to receiving such communications.

Section 23 requires the sender to be clearly identified within the message. However, a typical message sent by the marketing company on Nouveau’s behalf read:

“Lisa, are you in a tight spot? Make a simple application for Emergency funds! Visit www.txtcash.co/2cZ5o to get started. Reply STOP 2 end.”

As can be seen, it is far from clear who the sender of this message actually is.

Steve Eckersley, the ICO’s Head of Enforcement said:

“Relying on another company to do your marketing is not a get-out clause when it comes to the law. If your business has instigated a campaign, you are responsible and it’s up to you to make sure it meets the requirements of some very strict regulations.

“Our investigation found that despite relying heavily on direct marketing for its business, the company did not seem to understand the rules around electronic marketing and that’s not good enough.”

“The law is there for a reason, it’s to stop companies inundating people with unwanted messages. Nouveau Finance Ltd neglected its responsibilities and that’s why they received the fine and were told to halt the campaign.”

From April 2017 the ICO will be granted additional powers in this area. From this date it will also be able to impose fines on individuals who break the law regarding marketing communications. There has been concern that some firms who receive ICO fines are putting themselves into liquidation in order to avoid paying the fine, before the firm’s management then immediately start up again as a new entity. However, from next spring, the ICO will have the power to 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.

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.