When: 18 March 2013
Law stated as at: 4 April 2013
On 18 March 2013 the ICO issued a monetary penalty of £90,000 to DM Design, a Glasgow based manufacturer and retailer of kitchens,
bathrooms and bedrooms, in relation to repeated breaches of the Privacy and Electronic Communications (EC Directive) Regulations 2003 (as amended) (“PECRs”).
DM Design had been the subject of nearly 2,000 complaints to both the ICO and Telephone Preference Service (TPS) in relation to their
telemarketing practices. They consistently failed to check whether individuals had opted out of receiving marketing calls via the Telephone Preference Service, in clear breach of the law, and responded to only a small number of the complaints received.
The ICO gained new powers to issue monetary penalties of up to £500,000 for serious breaches of the PECRs in 2011, but this case represents the first time those powers have been used in relation to live marketing calls. They have already been invoked in the area of marketing texts, with penalties totalling £440,000 having been issued late last year against the joint owners of a company that was responsible for sending hundreds of thousands of spam texts.
More on the way in 2013?
It appears that the penalty against DM Design may be the first of a number in this area during the course of 2013. The ICO has already informed two more companies that it intends to impose significant penalties due to serious breaches of the PECRs, while a further ten companies are subject to on-going investigations.
Indeed, the Information Commissioner, Christopher Graham, said in relation to the DM Design case:
“This fine will not be an isolated penalty. We know other companies are showing a similar disregard for the law and we’ve every intention of taking further enforcement action against companies that continue to bombard people with unlawful marketing texts and calls”.
It is worth noting that since setting up an online reporting tool in March 2012 to allow the public to send details of any unwanted marketing texts and calls, the ICO has received over 140,000 complaints. Ofcom, which is responsible for regulating silent/abandoned calls and can issue penalties of up to £2,000,000 for breaches of the law in this area, has also seen a spike in complaints recently, as reported in the last edition of marketinglaw (see www.marketinglaw.co.uk/article-preview/ofcom-reports-dramatic-spike-in-unwanted-silent-call-complaints).
The large number of complaints and the conclusion of the investigation into DM Design has prompted the ICO and Ofcom to publish an open letter to the marketing industry reminding businesses of their duty to comply with relevant telemarketing laws and regulations (see here).
Why this matters:
The DM Design case and other recent developments indicate that 2013 could be the year when the regulators finally crack down on the issue of cold calls and spam texts, which have been causing consumer frustration for some time.
Companies would do well to assess their telemarketing practices
in light of this and give training to their staff where necessary. For example, in the DM Design case one employee refused to remove a complainant’s details from the company’s system and instead threatened to “continue to call at more inconvenient times like Sunday lunchtime” – not a good move!
The full monetary penalty notice in the DM Design case can
be found here.