On November 27 2015, the Claims Management Regulator at the Ministry of Justice (MoJ) imposed its fourth fine on a claims management company (CMC). The penalty of £850,000 imposed on Zahier Hussain – who trades as National Advice Clinic, the Industrial Hearing Clinic or the Central Compensation Office – is the largest fine imposed to date by the MoJ, after it gained the power to fine companies 12 months previously.

Mr Hussain‘s firm, based in Oswaldtwistle, Lancashire, made almost six million calls between October 2014 and April 2015 about compensation for hearing loss. Many of these calls were made to consumers who had registered with the Telephone Preference Service (TPS), and almost 2,000 complaints were received about these practices. The firm’s conduct has been described as “blatant and shocking” by a Government minister.

The MoJ says the firm also breached its rules relating to: record keeping; obtaining leads and referrals; and making introductions to solicitors.

Kevin Rousell, head of the MoJ’s Regulation Unit, said of Mr Hussain‘s conduct:

“This company’s cold-calling campaign was deliberate and sustained, and a flagrant breach of our marketing requirements. They showed an alarming disregard for the misery their tactics can cause, particularly to elderly and vulnerable people. The size of this penalty demonstrates how seriously we take this issue – nuisance calls will not be tolerated.”

Justice Minister Lord Faulks added:

“Nuisance calls are a real scourge to households, and people have simply had enough. I am pleased the regulator has imposed such a substantial fine for such blatant and shocking behaviour. This follows other large fines and the removal of over a thousand licenses from claims management companies since 2010. The government is committed to protecting the public from this nuisance – that at best wastes people’s time and at worst causes significant distress.”

Back in 2012, the firm’s activities were highlighted on the BBC TV programme Panorama.
The other fines imposed by the MoJ in the past year were:

• £567,423 to Rock Law Limited regarding irregularities in its contracts with clients
• £220,000 to Aurangzeb Iqbal, who traded as The Hearing Clinic, also for making millions of unsolicited marketing calls to TPS registered consumers and others about hearing loss compensation
• £91,845 to Complete Claim Solutions Limited for unsolicited calls regarding personal injury claims

The MoJ press release concerning the fine also highlights that 300 CMCs were stripped of their authorisation during 2014.

The Government has commissioned a wide-ranging review of the regulatory system for CMCs. Reacting to this fine, Rob Cummings, general insurance manager at the Association of British Insurers, called for tougher regulation by saying:

“The continuing high levels of nuisance calls and speculative claims some CMCs are responsible for demonstrate the urgent need for a regulatory regime which is fit-for-purpose.”
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.