From Spring 2017, directors can each be fined up to £500,000 by the Information Commissioner's Office (ICO) if their firms are found to be in breach of the Privacy and Electronic Communications Regulations (the Regulations) by making nuisance calls.
The Regulations outlaw the following practices:
• making unsolicited live marketing calls to anyone who has said they do not want these calls, or has registered with the Telephone Preference Service (TPS) or Corporate TPS (a central register of individuals/companies who have opted out of receiving live marketing calls), and
• making automated marketing calls unless the person has specifically consented to receive this type of call. General consent for marketing, or even consent for live calls, is not enough – it must specifically cover automated calls.
Currently, only firms can be fined by the ICO up to a limit of £500,000. The move to make individual directors liable for fines comes after it was reported that many penalised firms had declared bankruptcy/insolvency, thereby avoiding the fine. Making each director liable for a fine also effectively lifts the cap on penalties, making higher overall fines likely.
Elizabeth Denham, the Information Commissioner, said "the people running nuisance call companies have little regard for the anxiety and upset they cause…making directors responsible will stop them ducking away from fines by putting their company into liquidation."
Why is this important?
We all loathe nuisance calls, and this announcement demonstrates the Government's intention to properly clamp down on the practice once and for all – by targeting the place where it really hurts, the pockets of the directors running companies who actively disregard the rules. It's also a sign that the Government accepts that company fines can only go so far, and that sometimes lifting the corporate veil via statute is sometimes required.
Does this also display a greater intolerance towards unsolicited marketing in general? Will there be calls for other forms of corporate messaging to get the same treatment in the future? All this points (again) to ensuring that robust consents are put in place for all marketing activities, especially as the countdown to the new General Data Protection Regulation has now properly begun.
Any practical tips?
If your business is engaging in any form of telephone marketing, get under the skin of what those activities really contain and whether there is any chance of these being caught by the Regulations. Spring 2017 is not far away and systems take time to change. Delaying and putting your boss's house on the line is not the best career move, so act now!