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MoJ removes licences of 200 claims firms

The Ministry of Justice removed the licences of 200 claims firms during 2013 for flouting its rules, latest data from the claims management regulator shows.

This takes the number of claims firms operating in the UK to 2,254 as at November – down from a peak of 3,367 in 2011. The total consists of around 1,400 personal injury firms and about 1,100 financial claims firms.

In November, the MoJ announced that it is to be given the power to fine claims firms under an amendment to the Financial Services Bill.

It also launched a consultation on a set of toughened conduct rules for firms and an increase in fees for regulated claims firms.

Justice Minister Shailesh Vara says: “With rigorous new measures being brought in across the board, we are taking strong action to rein in the rogue firms operating in this sector.

 “Continued action to remove licences from companies with poor practices, alongside forthcoming regulation reforms, proves just how much work is going on to get tough on companies that defy the rules and bombard the public with unwelcome calls and misleading information.”

Highclere Financial Services partner Alan Lakey says: “Removing 200 licences is good news because the MoJ is clearly focusing on incorrect practices. 

“The MoJ is focused on claims firms charging consumers wrongly. But it is equally important that it looks at companies that are manufacturing claims.”

Last week, advisers expressed their anger at the inc-reasing use of data requests by claims firms as part of “fishing” exercises to file spurious complaints.

Last year, Highclere Financial Services was awarded £340 through the small claims court after contesting a payment protection insurance misselling claim from a claims management firm.


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