Govan Law Centre welcomes news of additional consumer protection for customers of Claims Management Companies (CMCs) in England and Wales, but remains concerned that Scottish consumers continue to go without any legal protection in relation to CMCs providing services in Scotland.
The UK Government has announced that from next year people who are ripped off or receive a poor service from CMCs will be able to pursue a complaint to the Legal Ombudsman for England and Wales. The Ombudsman can award up to £30,000 in compensation in individual cases. CMCs are regulated by the Ministry of Justice (MoJ) under the Compensation Act 2006 for services provided in England and Wales, whereas in Scotland they remain unregulated, albiet the subject matter is devolved to the Scottish Parliament.
GLC's Principal Solicitor, Mike Dailly said, "Consumer protection is being strengthened south of
border in relation to poor service by CMCs – and rightly so - while Scotland remains an oasis for CMCs to do as they please. Our unregulated market means that the people of
Scotland continue to have no redress or protection against CMCs. We call on the Scottish
Government to close this major gap in Scots law sooner rather than later'.
Many CMCs are well known for malpractice and ripping consumers
off; including not providing customers with contracts or paperwork, not
allowing cancellation of their service or refusing to allow any refunds,
misleading and exaggerating their success or service during sales calls, taking
payments from customers’ bank accounts or cards without authorisation, and
using third parties to engage in unsolicited marketing.