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Neil Liversidge: Time to take on the claims fraudsters

Neil Liversidge MM blog

Twenty-odd years ago, our village idiot, Eddie the Gluesniffer, stuck up the post office (no punintended) using a toy plastic Luger pistol.

It failed to impress the staff and customers just as the pair of his girlfriend’s knickers, worn over his face in place of the more typical stocking mask, failed to conceal his identity.

The sub-postmistress duly told him to go away in jerky movements and he wisely left empty-handed. The local pubs rang with laughter as the story got around.

Sadly for Eddie, however, the law had a sense of humour failure.

Eddie was removed from circulation for a while and Evo Stik sales declined dramatically.

Demanding money with menaces is not generally accepted as a legitimate way to earn a living. It’s reassuring then for those of us who are law-abiding citizens, to know that we can rely on the authorities to take a dim view and respond robustly to the likes of Eddie. 

Or can we? My experience of how the Ministry of Justice deals with claim fabrication – sorry, claim management – companies suggests otherwise.

Like most people I have had the unsolicited texts and calls telling me I have thousands of pounds due in PPI compensation.

Whereas I normally ignore them, recently I decided to play one along.

Taking a call from ‘Jack’ at an Indian call centre I was told that I had taken out PPI – not asked if I had. Jack then coached me vigorously to say that my loan was for home improvements, that I had been told it was a compulsory part of the loan package, that I never used it, never complained and had never been in a debt management plan, had an IVA or been made bankrupt. 

At the end of all this I was asked to confirm who I had had a loan with ‘just for data protection’. Up to this point, of course, they were winging it. I gave the name of a lender with whom I did take out a loan in 2005 – albeit without PPI.

 ‘Jack’ then patched me through to a claims management firm in the UK who took my details to send me a claims pack.

 All of this was disturbing enough but what really bothered me was the response of the Ministry of Justice. Despite reporting the fine details of the conversation the MoJ believed I was merely the intended victim of an advance free fraud scam.

An exchange of letters ensued with the MoJ trying to convince me the claims firm’s name was being used by a scammer. Only when I sent them the claims pack did the penny start to drop.

Claims firms operate with the approval of the MoJ – as they are always quick to stress. To get a result, they invariably threaten the target with the FOS.

It may be a more sophisticated approach than Eddie’s plastic gun but where the ‘victim’ is coached to lie it is surely no less a crime.

This week I had another call on behalf of the same firm but with a second UK-based intermediary interposed. As this goes to press, I have a meeting organised with the MoJ. I will let you know how I get on.

Neil Liversidge is managing director at West Riding Personal Financial Solutions


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There are 21 comments at the moment, we would love to hear your opinion too.

  1. Derek Bradley ceo Panacea Adviser 1st February 2013 at 8:59 am

    Good luck Neil. Alan Lakey and I met with the MoJ last year, they are very sympathetic to the cause. But the problem is the way in which the firms are regulated, the punishments available and where the marketing activities such as you describe, originate from.

    In my view they should be placed into the hands of the FSA/FCA where greater rigour can be exercised.

  2. Thankfully there are still a few people, like Neil Liversidge and Alan Lakey around, who are prepared to go the extra mile.

  3. Couldn’t agree more Neil – hope all goes well at the MoJ as until these companies stop what they are doing there is not going to be a financial services industry left!

  4. They are doing no worse than what the banks did in the first place….

  5. You and me both, Neil.

    I presume Eddie now works in Canary Wharf.

  6. Well done Neil and Alan and good luck!

  7. Wow Old Hat, what planet are you on?
    Good luck Neil, I hope not, but I suspect you may not get very far.

  8. Ian @ Kirkhillifa 1st February 2013 at 9:51 am

    We have had an experience with a company trying to pursue us for “mis-sold PPI”, although the contract in question was an Income Protection Policy (IPP){which was in claim!!}, possibly they were specialist dyslexic claims company. Being a responsible company, we contacted the MoJ and the FOS and notified our indemnity insurers. Although the eventual result was the MoJ revoking the “claims company” permission and instructing us to no longer respond and forward any future correspondence directly to MoJ, the man hours lost dealing with a completely fraudulent claim and subsequent cost have to be borne by us.

    On another note PPI claims seem to be incredibly easy to make and are met with very little resistance, the cost of processing these claims and paying out these claims are met by the banks, which in the majority of cases are failed or failing banks propped up by the central bank. If I didn’t know better I would think this is a form of QE!

  9. To Neil

    Last year I reported a solicitor firm advertising on the back of the Daily Mail for clients who had suffered investment losses. The advert read: Investment Loss Notice Have You Suffered Losses Because Of Mis-Sold And Investment.

    I phoned this company and asked whether they were authorised and regulated by the financial services authority as they were offering a free without obligation advice service. When I pointed out that you needed FSA authorisation to give advice on investments the phone suddenly went dead.

    I reported this matter to the Ministry of Justice and in fact have a very interesting taped telephone conversation where the individual stated that they did not have the expertise to check whether solicitors were complying with the Financial Servicing and Marketing act 2000. I also reported the matter to the FSA whistleblowing line with no response. I was so furious about this I actually wrote an article last year which was published by money marketing and have subsequently written a further article asking for the FSA to check the SRA register to see whether solicitors are actually authorised and regulated to give advice on investments.

    If solicitors want to challenge IFA advice they should at least hold the same level of authorisation and pay the necessary fees that we do. After all how can may possibly review a clients investments without giving advice to the client.

  10. Good luck Neil, I, as a Sesame member have requested on several times that the network take one of these claims companies to task, surely in the eyes of the law, fraudulent claims is trying to obtain money by deception, and therefore a criminal act. It would take just one case going to court for them to think a little bit more carefully about exactly what they claim.

  11. Christine Tillett 1st February 2013 at 11:10 am

    Well done Neil for saying what we all know to be true!…I had 3 calls before 9am on Tuesday from what I assume is an Indian call centre representing a claims company in Romford. I have wanted to play along with them many a time, but have instead told them where to get off. These companies are not distinguishing between PPI and MPPI which are 2 totally different things. Instead every time we get one of these fraudulent claims it takes up a ridiculous amount of our valuable time retrieving and examining client files. I am lucky I suppose to have only received half a dozen of them however I have colleagues in the business that have had hundreds of the damn things…The good old banks refer them back to the introducer, so do they really expect that we have millions of pounds set aside to pay them or even the FOS fees in fighting them? So what about the plans to limit the banks liability after next year; notice that does not include us as we subscribed to the MCCB (voluntary) Code of Conduct so are we to be held accountable forever and a day, whatever happened to our human rights not to be persecuted?…

  12. We report all claims from claims managers where no PPI was sold individually to the MOJ and had a phone call from MOJ to check if we had informed the claims manager that none had been sold. In the conversation the caller mentioned something about the better claims managers and I couldn’t resist asking them to name a better claims manager and they had to admit they couldn’t.

    Apparently the MOJ will ask the claims manager for the documents they have that evidence a policy was sold and when they fail to produce them they are then scheduled for an audit visit so it’s worthwhile notifying MOJ. A standard letter and photocopies of the claims manager documents sent to MOJ job done.

  13. @ Peter Herd

    Peter, you should know that the MOJ does not licence or regulate solicitors. This is carried out by the Law Society.

  14. A client of mine called today. Similar situation and told she is owed £3,000..Marvellous. She asked them to send the papers which they say they have, and they stated she just needs to sign and return them (so no material facts disclosed then!). If and when they arrive, do you want me to send them to you Neil, as maybe more cohesion from our industry might just make the MOJ stand up and take this fraud seriously!? It must misrepresent the terms of the data protection act if nothing else..If they have the info then how? If not, why are stating that they have to members of the public? Needs stopping once and for all…Here is an idea..Only SRA regulated firms can deal with such matters.

  15. I needed a laugh on Friday afternoon about IFA’s being hounded and mortgage brokers whinging about how unfair it is to be challenged by consumers and claims management companies about miss selling worthless insurance had me rolling around with laughter. As always the Financial Services Industry is wholly responsible for the storm that has fallen upon them. You as an industry where happy to sell ‘crap’ to the consumers are now reaping the whirlwind from that miss selling. We as firm don’t cold call and no one should but the industry that has grown up helping the consumer claim their money back is your fault and no one else’s. You had an opportunity to put this right and you failed to do so. Serves you right !!!!!!

  16. @ David (2.56 p.m.)

    Nobody condones mis-selling or bad advice but in this instance the article is about out and out fraud.

    Were it any other industry the police would be arresting these fraud-perpetuating villains right left and centre.

    You may call it licence to play with words, I call it attempted theft.

  17. Cap’n Birdseye | 1 Feb 2013 1:15 pm

    Solicitors are regulated by the Solicitors Regulation Authority who were established in January 2007 by the Legal Services Act 2007 and is an independent regulator body of the Law Society of England and Wales.

    The law society nowadays is a lobbying organisation according to its own website and helps promote the services of the legal profession.

    The reasons why I complained to the Ministry of Justice was because there are specific department dealing with claims management firms.

  18. Neil F Liversidge 1st February 2013 at 5:52 pm

    @David – did we ‘sell crap’ to the 69 year old lady whose house we saved after she had unwisely entered into unsuccessful litigation at a cost of £50k? At the time she couldn’t say enough good things about us. Six years later she signs off a complaint of mortgage mis-selling for a claim fabrication firm. Maybe they would like her put back in the position she would have been in, i.e. impending homelessness? We are witnessing the most widespread and systematic fraud in history, perpetrated by claims fabricators with the tacit collusion of government.

  19. I am still confused about all this.

    Getting a call from one of these shysters in no big deal – I just tell them to P— off and put the phone down. Life is too short to waste time.

    Fortunately I have not yet had one of these firms approach me on behalf of a client. Naturally I guess it may happen one day, but when it does, what is to stop me contacting the client directly and asking them why they believe they have a case to complain and suggesting that they put the case to me directly. I would point out that even if their case was genuine, why go to a CMC and loose a hefty slice of what they may receive, when they could do it themselves and not have any deductions.

    Apart from doing that I wonder how I would be placed if I then entirely ignored the CMC after sending them a copy of the letter I had sent the client (as above) and stating that if I couldn’t satisfy the client they (the clients) were at liberty to go to the FOS. If I am innocent then presumably I have nothing to fear. If I’m guilty it would be wise to settle directly with the client before things went any further.

    How out of touch am I??

  20. @ Peter Herd


    The SRA regulates law firms. You can check out whether the firm exists etc on . They also operate a telephone line which allows you to check on the disciplinary position of any individual firm or solicitor.

    You make the point about the solicitor not being able to provide financial advice. Most solicitors firms are “Exempt Professional Firms” giving them the ability to provide limited financial services activies. EPF firms are listed on the FSA Register. So logically, the FSA could intervene. They wouldn’t in practice as a law firms primary regulator is the SRA.

    Also, more than likely a review of the clients investments is “ancillary” to their main activity of providing legal services.

    I know the firm you refer to and cannot see what they are doing is either unlawful or in breach of any disciplinary rule. What they are saying is to the point and not misleading.

    What is a shocker is the use of call centres to randomly call people to “tell” them they have been given bad advice. That is out of order and needs stopping.

    If a law firm were using a claims handler (which it controlled or operated) then under the SRA principles this could be an issue. However, most law firms who do this operate at arms length and pay a fee per client (quite why you need to do this is anyones guess).

    Hope this helps.

  21. My comment did have a tongue in cheek side to it. However you are all missing the point. No regulated CMC has been know or shown to be involved in a fee up front for no service scam. Even cartel client review system failure was based on a firm of solicitors not doing what they where supposed to do. The involvement of off shore call centres in India says it all. They are not part of the claims management industry. However the use of the word fraud is right and proper it should be aimed first at the industry that sold PPI and the other worthless financial instruments !!!

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