Claims Management Companies or CMCs contacting people through cold calling or spam text messages could now face massive new fines under powers proposed by the Ministry of Justice.

CMCs are organisations that offer claims management services to the public, usually to seek compensation or other redress. They are particularly prevalent in the fields of personal injury and medical negligence.

Companies could now be fined up to 20% of their turnover if they are found to have used information through unsolicited calls and texts and for misleading marketing.

The Ministry of Justice already has the power to vary, suspend or cancel a CMC’s licence and prevent them from operating.

Too many disreputable organisations add nothing to the process of bringing a claim if you have been injured in an accident ~Ann Mahoney

Ann Mahoney, head of personal injury at M R Law comments: “Some CMCs do a good job in adverting to the public their right to pursue claims. However, sadly too many disreputable organisations add nothing to the process of bringing a claim if you have been injured in an accident or through medical treatment.

CMCs should never contact people through cold calling or spam text messages. If any engage in such practices, they deserve the punishment now proposed. Their actions bring the whole profession into disrepute.

Solicitors remain the most appropriate and first point of contact if a person wishes to make a claim for injuries arising from an accident or negligent medical treatment as even when approaching a CMC, the claim is then most likely to be passed on to solicitors in any event.”