When: 1 October 2014
Law as stated at: 8 October 2010
Ofcom has imposed a penalty of £10,000 on specialist insurer Ageas Retail Limited (“Ageas”) for persistent misuse of an electronic telecommunications network. Ageas was found to have made multiple abandoned calls from its call centres.
Ofcom had issued a notification to Ageas in April 2014 stating that it had reasonable grounds for believing that Ageas had carried out such activity as part of its own-initiative investigation. Ageas was given an opportunity to make representations and to take steps for securing that the misuse was brought to an end and not repeated.
The penalty was in the end imposed by Ofcom taking into account factors such as the steps that Ageas had taken since being notified of the misuse, as well as steps Ageas had committed to put in place, and Ofcom’s own statement of policy on the persistent misuse of an electronic communications network or service. The £10,000 penalty has to be paid within 30 days.
On the same day as issuing a public notification of the penalty, Ofcom announced a review of how it uses its persistent misuse powers, focusing on silent and abandoned calls.
Review of Ofcom’s powers
Ofcom has powers under the Communications Act 2003 relating to “persistent misuse of networks or services” and must publish a statement of its general policy on the exercise of such powers. The policy was last revised in 2010 and includes examples of activities which Ofcom considers to fall within such “misuse”, including silent and abandoned calls.
An “abandoned call” is where the person making the call terminates it after the consumer has picked up the receiver. “Silent calls” are a type of abandoned call where the consumer answers a call but can hear nothing and has no means of establishing whether anyone is at the end of the line. Both of these can occur when, for example, an organisation uses automatic calling systems (“ACS”) and all call centre agents are busy when the call recipient answers the phone.
The current policy sets out the types of measures organisations using ACS may take to help avoid making abandoned or silent calls and to limit the consumer harm caused as a result of such calls. The measures include:
• Letting the phone ring for a minimum of 15 seconds before the call is terminated
• Playing a brief recorded message in the event of an abandoned call, no later than 2 seconds after the phone has been picked up or after the consumer begins to speak. The message should as a minimum identify the company on whose behalf the call was made, provide a free or basic/geographic rate number the consumer can call to decline further calls, and should not be used to market goods or services (initially Ofcom took the view that Ageas had also fallen foul of this latter requirement by including a marketing message in its recorded message but after considering Ageas’s representations and reviewing the message content, Ofcom changed its mind)
• Provide a Caller ID so the consumer can return the call if they wish. Any call so made should not be used as a marketing opportunity without the consumer’s consent
• Guaranteeing the presence of a live call centre agent if a further call is made within 72 hours of a consumer receiving an abandoned call, or within 24 hours in cases where equipment used by the call centre has identified an answering machine
• Limiting the number of abandoned calls made to no more than 3% of live calls per campaign or per call centre over a 24 hour period
Ofcom is now seeking input from stakeholders on issues such as the main types of harm experienced by consumers from nuisance calls, what the key drivers are for silent and abandoned calls and views on potential changes to Ofcom’s policy to help reduce harm (including for example specifying the types of processes Ofcom looks for organisations to have in place).
Why this matters:
ACS are used by many types of organisations, including telemarketing companies, market research companies, debt collection agencies, charities carrying out fundraising activities and companies wishing to contact existing customers. Their heaviest users in recent times have been marketers of PPI mis-selling claims services.
The recent fine for Ageas is a reminder for organisations using the technology to review their processes alongside Ofcom’s policy to see if they have appropriate measures in place to avoid making abandoned or silent calls and to limit consumer harm caused by such calls.
Responses to Ofcom’s call for inputs should be provided by 7 November 2014. Ofcom then plans to publish a consultation in Q1 of 2015-2016 setting out any proposals for changes to its policy and a final statement in early Q3.