The ICO Receive Government Backing to Personally Punish Nuisance Call Directors


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New government regulations will make directors of nuisance call companies personally accountable for their actions, so that fines cannot be avoided by directors putting their company into liquidation.

Since the government changed the law in April 2015, to make it easier for the Information Commissioner’s Office (ICO) to fine the companies behind nuisance calls, more than £2.7 million in penalty fees have been issued.

It’s a figure that sends out a clear message that the companies behind this nuisance will be held to account.

But another statistic, that only 6 of the 27 fines were paid in full, was much less welcome. Or to put it another way, £2.26million of the penalties that the ICO have issued remain entirely unpaid.

So, the individuals who are behind those companies are not facing the consequences of their actions.

The problem end of this sector is characterised by small marketing companies that pay little heed to the rules. Setting up an operation that can make millions of calls is unfortunately surprisingly easy, with little outlay required on equipment, premises or staff.

It can literally be a cottage industry, and as these companies are typically limited companies, directors can be quick to look to liquidation as a way out of paying fines.

Martyn King, Managing Director at Nexbridge, asserts that, “The direct marketing industry is unfortunately damaged by a small number of characters who repeatedly set up businesses with the sole purpose of making a quick buck.”

These people have “little thought for regulations, the law and the impact it has on the consumer with nuisance and unwanted calls, let alone potentially leaving communications providers with unpaid debts for calls made.”

“It’s all too easy for an individual to set up a business, generate millions of calls and then place that entity into insolvency, assigning a placeholder director (often overseas) before resigning themselves as a director.”

After doing so and “distancing themselves from the business, they can then do the same thing over again with a new entity.”

But that could now change with the government’s announcement that it wants directors to have responsibility for making sure their companies follow the law.

These actions were praised by Martyn, as making sure “directors remain accountable is a very positive step forward in helping to create a better image for the industry as a whole and hopefully results in deterring, and ultimately preventing these individuals from operating in the industry.”

The law change is expected to occur next spring, but in the meantime, those companies that the ICO has already fined won’t be walking away scot-free.

The UK has a strong insolvency regime and the ICO will work with experienced professionals and the courts to pursue money owed on behalf of taxpayers and those millions of people who have been bothered by unwanted calls.

Author: Robyn Coppell

Published On: 26th Oct 2016 - Last modified: 18th Dec 2018
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