Who: The Information Commissioner’s Office (ICO)
Where: United Kingdom
When: March 2021
Law stated as at: 25 March 2021
What happened:
The Information Commissioner’s Office (ICO) has fined two companies a total of £330,000 for sending, between them, 2.7 million spam text messages during the Covid-19 pandemic and issued enforcement notices ordering them to stop sending unlawful marketing messages.
Leads Work Ltd (LWL)
LWL, a sales lead generation business, was fined £250,000 for sending over 2.6 million unsolicited, direct marketing texts to customers between May and June 2020, resulting in a record 10,000 complaints. The messages were intended to appeal to those needing extra money during lockdown, and included variations of the following text:
“In lockdown and want to earn extra cash? Avon is now FULLY ONLINE, FREE to do and paid weekly. Reply with your name for info. 18+ only. Text STOP to opt out.”
The ICO’s main grounds for imposing such a steep fine and enforcement notice on LWL were as follows:
- The consent that LWL relied upon to send the messages did not amount to valid consent. Under Regulation 22 of the Privacy and Electronic Communications (EC Directive) Regulations 2003 (PECR), organisations cannot send marketing texts unless the recipient has informed the sender that they consent to the texts being sent. The General Data Protection Regulation (GDPR) defines consent as something which must be “freely given, specific, informed and unambiguous”.
The ICO ruled that consent was not freely given, specific and informed in this instance because the website of LWL’s dominant data supplier was “vague and confusing given the lengthy nature of the consent statement and the extensive list of sectors and companies contained within both it and the privacy policy”.
- The texts misleadingly appeared to be sent by Avon (a direct sales company in the retail sector). LWL deliberately did not identify itself as the sender of the messages, and, as such, was deemed to be in contravention of the requirements under Regulation 23 of the PECR.
- LWL sought to take advantage of those who may be financially vulnerable due to the Covid-19 pandemic by advertising the potential financial gains by becoming an Avon representative.
Valca Vehicle Ltd (VVL)
VVL, a company specialising in lead generation for financial products, was fined £80,000 for sending more than 95,000 unsolicited, direct marketing texts between June to July 2020, resulting in 114 complaints. The messages contained variations of the following text:
“*firstname* Affected by Covid? Struggling with finances? lost job/furloughed? Were [sic] here to help! Gvnmnt backed support see if you qualify http://www.debtquity.org”
The ICO’s grounds for imposing penalties on VVL were similar to those for imposing penalties on LWL, and included:
- VVL’s failure to obtain valid consent for sending the text messages, in contravention of regulation 22 PECR. VVL relied on consent obtained by another organisation (that is, “indirect consent”) which, as stated in the commissioner’s direct marketing guidance, is not sufficient for direct marketing via text, email or automated phone calls, unless it is clear and specific enough.
In this instance, the data supplier’s small-print privacy policy presented individuals with a list of 460 organisations which may contact them (of which, VVL was one), and the ICO found that this list was far too exhaustive to enable those individuals to give valid consent.
- The fact that the text messages sent by VVL did not contain an opt-out link, contrary to the requirements of regulation 23 PECR.
- Concern that VVL were attempting to capitalise on and profiteer from the national health crisis (based on content of the messages which reference the Covid-19 pandemic).
Why this matters:
The penalties imposed on LWL and VVL should remind businesses of the power that the ICO has under the PECR to impose monetary penalties of up to £500,000 on businesses, and, as such the importance of ensuring that any direct marketing is compliant with the GDPR, PECR and Data Protection Act 2018.
