The Ministry of Justice has reported a sharp increase in the number of enforcement actions it has taken in the second quarter of the year, as it seeks to clamp down on claims management companies.
A total of 25 investigations were started between April and June, compared with 35 in the entire year to March 2014.
The regulator has also stepped up the number of warnings it issued, with 136 warnings in Q2, the majority of which were related to PPI misselling. This compares with 144 warnings in the 12 months leading to March this year.
Some 26 firms engaged in direct marketing were audited between April and June, to ensure they were not sending nuisance calls and texts.
The MoJ says it has also “increased the number of website checks, with a view to identifying and putting a stop to any misleading marketing”.
Despite the increased investigation activity, the regulator cancelled only two authorisations in Q2, compared with 42 in the previous year.
The MoJ is also monitoring CMCs to ensure they are following rules introduced in April 2013 banning referral fees. Since the ban came into effect, the regulator has visited over 900 firms and audited more than 250.
A total of 73 audits were carried out to enforce the referral ban between April and June, with 10 warnings issued.