In its October 2013 Business Bulletin, the Claims Management Regulator (CMR) at the Ministry of Justice (MoJ) spoke of what it described as a ‘high level of non-compliance’ on companies’ websites, making specific reference to the new requirements introduced in July.

The CMR has found that a ‘significant’ number of claims management companies (CMCs) still describe themselves on their website as being regulated by the MoJ. Companies should now be using the statement: ‘Regulated by the Claims Management Regulator in respect of regulated claims management activities.’ There is no flexibility over the wording to be used, so this exact statement should appear on all CMC websites. Although the Claims Management Regulator is part of the MoJ, it has been suggested that the old wording could amount to an inference that the government has endorsed the firm.

It is also reported that a smaller number of CMCs have not complied with the requirement to prominently display their terms and conditions on their site.

These two conditions are respectively Client Specific Rules 6(d) and 11 in the CMR’s Conduct of Authorised Persons Rules. These changes were amongst the new requirements announced in April and which came into force in July. Other new requirements introduced at this time included a ban on verbal contracts and the need for companies to alert all their customers within 14 days if they are subject to regulatory enforcement action.

In addition, from April 1 2013, CMCs were banned from issuing advertisements that offered cash inducements, and were banned from receiving referral fees. It is also now possible for a customer to refer a complaint about a CMC to the Legal Ombudsman if they are not satisfied with the company’s response.

Regarding the website content issues raised in the Bulletin, CMCs were warned to make the necessary changes to their websites immediately, or face enforcement action. The content of the Bulletin is a timely reminder to CMCs of the various new requirements which have been imposed on them during the course of 2013, and companies need to make sure they are complying with all of their new obligations.

The October Bulletin also made reference to the recent letter from the Financial Ombudsman Service (FOS) to CMCs regarding payment protection insurance (PPI) complaints. CMCs are requested to work with financial businesses to resolve complaints quickly, and to provide a completed FOS complaint questionnaire, signed by the client, whenever a PPI complaint is referred to the FOS.

Other issues covered in the Bulletin include an update on the programme of visits to assess compliance with the referral fee ban, a warning from the Solicitors Regulation Authority regarding personal injury claims and notice of the CMR’s intention to consult both over new rules for CMCs and fee levels. The full Bulletin can be viewed at http://www.justice.gov.uk/downloads/claims-regulation/cmr-bulletin/cmr-business-bulletin-21-1-13.pdf