Don't be scammed!

by Neil Faulkner on 04 June 2009  |  6 comments
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Worried about being scammed? Find out your rights on how to fight back!

It's been one year since I wrote about some powerful new consumer law, so I'd like to re-visit it and tell you how effective it's been.

The Consumer Protection from Unfair Trading Regulations contain a general prohibition against unfair commercial practices, banning misleading actions, misleading omissions and aggressive sales and marketing. A trader is probably in breach of the regulations if it misleads, behaves aggressively, or otherwise acts unfairly towards consumers.

(Note: these regulations are not related to the Unfair Terms in Consumer Contracts Regulations upon which bank charges cases are being fought.)

In addition to a general prohibition against bad behaviour, it explicitly bans 31 trading practices, such as pyramid schemes, falsely claiming that a product can cure illnesses, and making persistent and unwanted sales solicitations. Many of the techniques are common marketing ploys used by banks, retailers, and virtually every type of business.

Read more about exactly which type of scams are banned.

The new laws are gaining momentum

Considering the effect on business, it was introduced surprisingly quietly and is just slowly building momentum. Last year I tested the new rules. I wrote to one company, a broadband-comparison site, asking if it was aware that it was now committing an offence by pretending it was offering better terms on a product for just 30 days. I sent them a copy of the regulations. It didn't respond, but it ended the false promotion.

The local authorities and the Office of Fair Trading (OFT) have started testing the legislation too. About six months ago the OFT began its first court case and since then it's snowballed. The Local Authority Trading Standards Services have now taken enforcement action 171 times.

Rogue traders from at least 22 types of business have been targeted. Here are the six types of business that have received the majority of attention so far:

Top six types of businesses that have been targeted

The top one, home maintenance and improvement (e.g. home paving and tarmacking), includes action against both aggressive sales, and misleading actions and omissions. Homeowners have been helped some more with an attack on rogue traders operating house construction or gardening services.

With the attention on these businesses, other similar companies should soon begin to notice and check their trading practices. I have no details yet about what enforcement action has been taken or how effective it's been, but the regulations give huge powers to local authorities to investigate possible rogue businesses, and offences are punishable by up to two years in prison and/or an unlimited fine.

Fairer treatment is at hand

However, I believe there are thousands of businesses still breaching the new regulations without even realising it, and I've seen many examples in shop windows, on the Internet and in email marketing. The types of businesses and the overall number of them that are targeted should rise dramatically as the authorities get to grips with the rules.

If you come across any of the outlawed practices, you can contact Consumer Direct, who will forward cases onto Trading Standards.

My hope is that everyone will read up on the 31 banned scams, because they are seriously packed with weapons for customers - but you won't be able to fight for your rights if you don't know what they are!

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> Read more about this consumer law in:

Consumer (and landlord) rights are improving

31 types of scam to end this month