The Government has at last bowed to pressure to resurrect legislation which will enable the Information Commissioner’s Office to make directors of rogue telemarketing firms personally liable for fines of up to £500,000, after scores have simply shut up shop to avoid ICO penalties and started again.
Decision Marketing launched its own “Call Time on Rogue Marketers” campaign in February after a Freedom of Information request found that of the 40 companies which had received Privacy & Electronics Communications Regulations (PECR) penalties between 2015 and January 2018, 27 had either gone into liquidation to avoid the fine or been brought down by other creditors.
At that time, out of the £7m in penalties issued for so-called nuisance calls and texts since 2015, nearly £5m remained unpaid. However, the problem has escalated this year. Two companies, Barrington Claims and Goody Market UK, which were fined a total of £290,000 by the ICO in January have entered proposals to “strike off” and a third which owed £350,000 has already being dissolved.
Robert Matthews, the sole remaining director of Barrington Claims – which was fined £250,000 for 15 million automated calls – resigned in late January but was soon appointed a director of a company called World Financial Group.
Meanwhile, at Goody Market UK – which was hit with a £40,000 penalty for 111,367 spam texts – Paul O’Donnell is listed as a director while Paul McCarthy resigned in March. However, McCarthy is also a director of Bridgegate Finance, where he puts his occupation down as a “labourer”.
And despite the ICO saying it had successfully blocked the director of Miss-sold Products UK from closing the business – which was fined £350,000 for making 74 million unlawful automated calls – the firm is now listed as dissolved. According to Companies House, Douglas Andrew Albury has dissolved over 30 businesses.
Both the ICO and the DMA backed the Decision Marketing initiative.
Until now, the only action which has been possible has been to ban rogues from holding company directorships. So far this year, four directors – Allan Brown and Kenneth Haswell of Nevis Home Improvements, Leah Masters of Cold Call Elimination and Tony Abbott of Reactiv Media – have been barred for a total of 24 years.
Now the Government has announced it is opening a consultation over tightening the PECR legislation to make directors personally liable. The consultation run until in August.
The measures were first included in The Unsolicited Marketing Communications (Company Directors) Bill 2016-17, but despite support from the then digital minister Matt Hancock – who is now the Secretary of State – the Bill was scrapped in the run-up to the 2017 General Election. The ICO has repeatedly said the legislation cannot come soon enough.
ICO deputy commissioner Steve Wood said: “We have been calling for a change in the law for a while to deter those who deliberatly set out to disrupt people with troublesome calls, texts and emails. These proposed changes will increase the tols we have to protect the public.”
DMA director of policy and compliance John Mitchison said: “It should come as no surprise that individuals willing to skirt the law when it suits them are also ready to do the same to avoid paying their debts. That’s why we wholeheartedly support the extension of fines to the individuals that are behind these rogue businesses. The introduction of these new laws would target the individuals profiting from these rogue businesses, making them think twice about breaking the law if there is a real threat that they may be personally liable.”
Decision Marketing publishing editor Charlie McKelvey added: “At last, these rogues will be brought to book. Why it has been allowed to fester for so long is beyond comprehension. We know the ICO and DMA have been calling for tougher sanctions for a long time. We like to think that our campaign helped to further raise awareness of this issue, and, if so, we firmly believe it is yet another victory for campaigning journalism.”
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