On 1st December, The Sunday Times published an article about a Spanish based firm DeudaFix (debt fix), which offers help to consumers with debts of more than €5,000 (£4,260), and claims it can use a legal process to slash debts by up to 75% and freeze interest payments.
The Sunday Times claimed that DeudaFix is linked to a Mark Kennedy who was disqualified as a company director by the FCA for unscrupulous practices, including charging customers without their consent. An FCA report said he had displayed a lack of honesty and integrity, but the ban does not stop him operating outside Britain. Until recently he was listed on his LinkedIn profile as DeudaFix’s co-founder and chief technical officer. References to the company have since been deleted. Kennedy insisted he had provided only technology to the company to help it start up, adding that his work with DeudaFix had now ended. Kennedy, also deleted his profile photograph and said he was not employed by, or a director of, anything in Spain at the moment.
However, The Sunday Times maintains that emails reveal Kennedy offered to use DeudaFix to drive business volumes to a legal firm specialising in personal insolvency — adding that the work would begin in January. He later offered to invest in the company, saying that the two could become strong strategic partners.
Professional Personal Claims Limited
The FCA has fined CMC Professional Personal Claims Limited £70,000 for misleading consumers through its websites and printed materials. PPC’s websites and printed materials prominently used the logos of five major banks which was liable to mislead consumers into believing they were submitting redress claims for mis-sold payment protection insurance directly to their banks, rather than engaging PPC as a CMC to pursue claims on their behalf in return for payment of a success fee. PPC also failed to present accurate, fully formed, detailed and specific complaints to banks. It had submitted Financial Ombudsman Service questionnaires to banks on behalf of different consumers. The questionnaires in part contained identical factual allegations where evidence specific to each client should have been presented.
The Claims Management Regulator, under the prior regulatory framework applicable before 1st April 2019 launched an investigation following a number of complaints between October 2015 and March 2017 from clients of PPC and financial firms.
On 5th December 2018, the CMR determined that PPC had breached the previous CMC conduct rules by using websites and marketing materials that were misleading and by submitting misleading material to financial firms in support of its clients’ PPI redress claims. The CMR imposed a £70,000 fine for these failings.
PPC appealed on 21st December 2018 to the First-tier Tribunal against the CMR’s penalty notice. While the appeal was pending, the FCA took over regulation of CMCs from the CMR. The FCA therefore replaced the CMR as the respondent to PPC’s pending appeal. On 16th September 2019, after reviewing the evidence put forward by the FCA, PPC withdrew its appeal, and the FCA therefore imposed the £70,000 fine on PPC for the failings identified in the CMR’s penalty notice.
Shepherd and West
On 10th December CMC, Shepherd and West Ltd was granted full authorisation by the FCA. Its sole director is Ciaran Hamilton who has, or has had, 13 other directorships including currently Legal and Financial Solutions Ltd at the same address as Shepherd and West Ltd. Legal and Financial Solutions Ltd used to be a regulated CMC trading as LFS Claims but does not appear to have FCA authorisation currently.
Ciaran Hamilton was a director of CMC Chadney-Smith Associates Ltd (which currently holds FCA Temporary Permission) from July 2017 to September 2017, and was appointed a person with significant control. Co-directors included Damien Kennedy and a confirmation sheet dated 3rd July 2017 lists the shareholders as Nicholas Smith, Ciaran Hamilton, Legal and Financial Solutions Ltd and disqualified director Mark Kennedy (see DeudaFix above).
Lead generator firm Hennessy Jones
The Financial Services Compensation Scheme has received more than 2,000 claims against a trio of financial advice firms found responsible for pension transfer failings by the FCA. In May, the FCA said it was seeking to ban and fine the directors of three financial advice firms – Financial Page, Henderson Carter Associates and Bank House Investment Management – for acting without integrity over their pension advice business.
The regulator’s decision notices state all three firms were receiving customer introductions from the same lead generator firm, Hennessy Jones, to facilitate customers moving their pensions to Sipps investing in high risk, illiquid assets not regulated by the authority in which Hennessy Jones had a material financial interest. This interest was not disclosed to customers.
The FCA states that the advice firms adopted a pension review and advice process initiated and influenced by Hennessy Jones. This resulted in customers who met certain pre-set criteria being advised to switch their pensions to Sipps investing in the loan notes in which Hennessy Jones had an interest.
Alistar Green Legal Services
In a recent tribunal, a Judge increased the fine on Alistar Green Legal Services by £10,000. AGLS were originally fined £80,000 by the Information Commissioner for making a number of nuisance calls. However, the judge highlighted that the company director had demonstrated a clear pattern of wholesale disregard for data protection law. Director Kabir Abbas Sharif had previously controlled Lumen Corporation and liquidated the company before the ICO could take action against its nuisance marketing.
CMC JMP Partnership a family firm based in Sandown on the Isle of Wight, has announced it is set to close next year after 13 years of business. In July, the claims management company closed to new clients, and five months on, the firm has announced it will close for good, and the directors will retire. They say that they have really enjoyed taking £65 million from the banks and putting it back into the consumers’ pockets, without mentioning the cut they took for themselves - 20% of the gross refund plus VAT – so probably around £13 million. They also assert that the CMC industry is closing by one or two firms a day and that the writing is on the wall for the entire industry. With JMP Partnership closing (it had 1,600 clients producing over 2,000 claims cases), 15 individuals will lose their jobs by March 2020.
ME Legal and Financial Ltd
CMC ME Legal and Financial Ltd, based in Cheadle, Cheshire, which had Temporary Permission from the FCA is now winding down its CMC business. From 4th December, the firm could no longer take on, or offer to take on, any new business which would constitute a regulated claims management activity and with effect 4th January 2020, the firm is no longer able to carry out any regulated claims management activities. Its sole director is Philip Edward Jones who has, or has had, 12 other directorships.
Hall and Hanley Limited
The First-tier Tribunal has upheld a fine of £91,000 imposed on CMC Hall and Hanley Limited by the Claims Management Regulator, the former regulator for claims management companies. The hearing for the Tribunal was conducted by the FCA which has taken over the functions of the CMR. The £91,000 fine was initially imposed by the CMR under the previous regulatory regime for CMCs due to data breaches and unauthorised copying of client signatures. H&H had appealed to the Tribunal against the fine.