Ban ‘impossible to enforce effectively’, says trade body
The Claims Standards Council (CSC) plans to launch judicial review proceedings if the UK government goes ahead with its proposed referral fee ban.
Solicitors for the trade body, which represents the interests of claims management firms, have written to the government warning of the plan.
A judicial review is effectively a challenge to a decision or action by a public body, under which a judge reviews the lawfulness of the decision or action.
“It is time the government stopped treating claims management companies as being to blame for all that is wrong with motor claims. Its attention should be on better regulation to weed out those rogue traders and offshore marketers responsible for abuses like cold phone calling and SMS spamming,” CSC chairman Darren Werth said in a statement.
He added: “It is plain wrong to victimise legitimate businesses who provide a service to the public and help them achieve access to justice, as the Legal Standards Board reported only a few months ago. A ban would be unlawful, procedurally unfair, irrational and disproportionate. In any event, it would be impossible to enforce effectively.”
Werth contended that the referral fee ban would “fly in the face” of the government’s policy to reduce regulation of business, and that it would remove access to justice for thousands of people.
He also criticised the attention the government has paid to the position of the Association of British Insurers (ABI).
“We are concerned that too much weight is given to the unfair picture put forward by the very loud, powerful and well funded ABI insurance industry lobby,” Werth said. “ It would be far better for the government to work with the CSC so it can properly understand the service that claims management companies provide, and to work with us on developing more transparency as the best way of improving our accountability to our customers, the public.”
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