The Claims Management Services Regulator was created by section 11 of the Compensation Act 2006. The post of Regulator if occupied by the Secretary of State for Justice to authorise and regulate claims management companies and:
- Set and monitor standards of competence and professional conduct;
- Promote good practice, in particular as to the provision of information about charges and other matters to users;
- Promote practices likely to facilitate competition;
- Ensure that arrangements are made for the protection of users, including complaints handling.
The rules and procedure for authorisation are defined in the Compensation (Claims Management Services) Regulations 2006. The Regulator may investigate unauthorised trading and seek an injunction to prevent it or bring a criminal prosecution. It is a crime to obstruct the Regulator, punishable on summary conviction by a fine of up to level 5 on the standard scale.
A person may appeal a decision of the Regulator about authorisation to the Claims Management Services Tribunal and there is a further route of appeal to the Court of Appeal.
When section 161 of the Legal Services Act 2007 comes into force, claims management services and the Regulator will fall under the supervision of the Office for Legal Complaints and its ombudsman scheme. It has been suggested that the first complaints will not be handled until 2010.
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