'Claims farmers' legislation still flawed, insists Makin.

Byline: BY VICKY ANDERSON Daily Post Staff

THE first annual report into the impact of claims management regulation has been released by the Ministry of Justice.

The report, which marks a year since the implication of the Compensation Act 2006, says better regulation has significantly reduced cold calling in person, which includes the practice of clip boarding - knocking on doors and aggressively approaching people in shopping centres.

Unauthorised advertising and marketing in hospitals have also been almost entirely removed.

Bridget Prentice MP, Parliamentary under-secretary of state at the MoJ said: "I am delighted to present the first annual review for the Ministry of Justice claims management regulation unit.

"The regulation has put in place vital safeguards for consumers when using the services of claims management companies and is raising standards across the industry. The new rules that claim managers must now follow have cleaned up the industry.

Consumers can have more confidence that they will be dealt with fairly when seeking to make a claim."

Remaining unconvinced to the achievements of the new regulation is city solicitor Professor Rex Makin, who has previously spoken out against "claims farmers".

He told LDP Legal: "The Ministry of Justice report makes sorry reading for those engaged on behalf of the public with regard to claims.

"It states that the ministry has by and large eradicated bad practice and mis-selling.

"It cheerfully states the good news for consumers is they can now expect a more open service from those companies and that they will be treated fairly.

"How would claims management explain a circular pushed through the door touting for accident business 'Slip, trip or fall' in South Liverpool, while another claims-touting company leafleted householders in Knowsley at the same time for road traffic accidents and industrial diseases.

"Can the Ministry tell us how many prosecutions for violation of the Act have been undertaken and how many have been successful? I await a deafened silence."

The report states those authorised to provide services must follow rules of conduct to ensure consumers are given clear information about the options for pursuing their claim and the associated costs.

If an authorised person fails to comply with the rules, the regulator can take appropriate disciplinary action.

Other successes mentioned in the report include a strategy to deal with outright fraud like contrived accidents, and a significant reduction of malpractice by companies handling claims made to the Criminal Injuries Compensation Authority, with some businesses voluntarily leaving the market.

A spokesperson for the MoJ said: "The speed in which regulation was introduced - nine months from Royal Assent to the Act being fully in force - and the success in raising awareness among businesses who need to be authorised, resulted in three times more businesses coming forward than anticipated.

"The flexibility in the legislation and the regulatory framework means we can respond to such demands quickly."

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