Citizens Advice has said fines for claim firms are a step towards protecting consumers but a ban on cold calling by claims management companies would do more to stamp out unsolicited calls.

The Ministry of Justice yesterday announced that the Claims Management Regulation (CMR) Unit will be able to issue fines to firms using information from cold calling or breaking the rules.

Gillian Guy, Citizens Advice chief executive, said: “Some claims management companies have proved to be nothing more than a menacing intermediary. They are taking thousands of pounds worth of people’s PPI pay-out for what is essentially basic administration. In some cases people aren’t getting the compensation they were promised and are finding that claims services are not up to scratch. Companies behaving this way deserve to be hit with a large fine, as the Government has outlined today.

“Citizens Advice has been pressing for action against cold callers for some time now. Our research finds over 30 million people have been contacted out of the blue about PPI and half have received unexpected calls or texts more than 10 times in the last 12 months. The Government could further protect consumers by banning claims firms from using cold calling altogether. Consumers would then know a call out of the blue from a claims company is a firm not to be trusted.”

Research from Citizens Advice finds people’s work, family time and even household chores are being put on hold to answer calls about re-claiming for PPI.

• 27% received their most recent call during a during a family meal time;
• 14% received the call while at work including during meetings and presentations;
• 13% of people were contacted during TV and film viewing;
• 4% were carrying out their domestic duties, like cleaning, cooking and gardening, when they last received a PPI claims call.
• Telephone calls (91%), automated messages to landlines (39%) and texts to mobiles (35%) are the most common ways in which people are contacted about PPI claims.