Original URL: http://www.theregister.co.uk/2004/10/27/icstis_ruling/

Scammers fined £125k for premium-rate fraud

Watchdog bites pair of 'free holiday' outfits

By Tim Richardson

Posted in Mobile, 27th October 2004 09:07 GMT

Premium rate watchdog ICSTIS has fined two companies a total of £125,000 for running scam telephone services that ripped off punters.

Reading-based Power Promotions copped a £75,000 penalty for a dodgy service that offered consumers a bogus "free" holiday worth £2,000. Punters complained that they received spam phone calls offering them the holidays and then asked to phone a premium-rate number to claim their prize.

ICSTIS found the holidays didn't actually exist and that all that was on offer was a booklet of money-off vouchers.

Manchester-based Premier Hotline Promotions also pulled a similar stunt offering punters the chance to phone a premium-rate line to win a non-existent holiday worth £2,000. In this case, punters received an unsolicited telephone call in which they were played an automated recorded message telling them to call a premium-rate number. ICSTIS fined this outfit £50,000.

Indeed, the problem of consumers being targeted by recorded messages has been getting worse over the last couple of months. In its latest industry briefing ICSTIS warned that it had seen a "significant increase" in the number of complaints received about premium rate services that are promoted by unsolicited and unwanted automated messages.

Under the "Privacy and Electronic Communications (EC Directive) Regulations 2003", it is illegal to use automatic calling equipment to make unsolicited direct marketing calls.

As in the case of Premier Hotline Promotions, many of the services plug non-existent prizes such as luxury holidays or cash. The regulator has warned the industry that it will take tough action against any operator in breach of the regulation.

"We will continue to bar access with immediate effect to services that are deemed to be causing serious consumer harm, as well as asking for all revenue to be withheld from the service provider pending the conclusion of our investigation. Where breaches of our code are upheld in respect of such promotions, service providers can expect heavy sanctions to be imposed," it said.

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