Bosses to be made liable for nuisance calls and texts
08 December 2014 -
Senior executives may have to take greater responsibility for key aspects of their firms’ marketing campaigns, under proposals unveiled by a Which? Task Force
Company directors could be held accountable for their firms making unwanted calls and texts to members of the public, under recommendations unveiled by the government’s Nuisance Calls Task Force. Chaired by Which? executive director Richard Lloyd, the group has also asked for companies found guilty of causing distress to consumers through persistent phone calls and texts to be fined up to £500,000. One proposal suggests that fines for cold callers selling Payment Protection Insurance (PPI) could total up to 20% of their companies’ annual turnovers.
According to the Task Force, British citizens receive almost one billion unwanted phone calls per year. And earlier this year, communications regulator Ofcom admitted that a national telephone preference service – designed to help households block unwanted calls – was failing to stop two-thirds of unsolicited calls and messages.
As such, the Task Force has produced a series of recommendations on behalf of minister for Culture and the Digital Economy Ed Vaizey, to halt the improper uses of personal information that have spurred much of the unwanted contacts. It has also called on firms to work harder to improve their direct-marketing practices – urging them to deal with compliance on consumer-consent rules at their highest ranks.
From a management viewpoint, implementing the proposals would put the onus squarely on bosses to take greater responsibility for this area of their marketing – and that, coupled with increased risk levels, could trigger widespread cultural change. Indeed, watchdogs would be likely to take action far more often if – as the Task Force suggests – the threshold by which regulators can punish offending firms is lowered from “severe distress” on the complainant’s part to simple “annoyance”. The Task Force also says that senior managers at marketing companies should ensure any sales leads they buy have been fairly and legally obtained, and that they have a record of consumer consent being given.
Lloyd said: “Consumers have suffered nuisance calls and texts for far too long. They are often confused or misled by requests for consent to being contacted, so today we set out recommendations to introduce tougher rules and more action from businesses, the regulators and the government. Only through concerted and coordinated action will we put people back in control of their data, and help bring this modern-day menace to an end.”
The Task Force also outlined how regulators and the government can work together to tackle the problem. The Competition and Markets Authority (CMA) was urged to work with other regulators to understand issues that cause consumer harm, and identify action to remedy problems. Meanwhile, the Information Commissioner’s Office (ICO) was called upon to find better ways of providing information to harassed consumers – such as by rewording online or physical forms that enable people to opt out of being contacted. In parallel, the government should lead a cross-sector business-awareness campaign to ensure that companies know their responsibilities when it comes to issuing marketing calls and texts.
Vaizey said: “For too long, nuisance calls have plagued consumers – often at very inconvenient times of the day, and in some cases leaving vulnerable people like the elderly too scared to answer the phone. That’s why we’re determined to tackle this scourge through the first-ever Nuisance Calls Action Plan. We’ve already made progress – including by making it easier for Ofcom to share information with the ICO about companies breaking the rules – and we’re currently looking at lowering or removing the legal threshold before firms could be hit with fines of up to £500,000.”
He added: “By working together with the industry, regulators and consumer groups such as Which? – who we are grateful to for heading up the Task Force – we can work to make a real difference for consumers. The report provides clear action for business and regulators to act on, and we will carefully consider the recommendations for government.”
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