Homeserve fined for abandoned calls

Home insurance and repairs company HomeServe has been fined £750,000 for making an excessive number of silent and abandoned calls, Ofcom said today.

HomeServe exceeded the limit on the number of abandoned calls it is allowed to make on 42 separate occasions during February 1 and March 21 last year, the communications regulator said.

This resulted in an estimated 14,756 abandoned calls being made to UK consumers during this time.

HomeServe also placed an estimated 36,218 calls in breach of a rule prohibiting companies from making repeated calls to answerphones within 24 hours, according to the watchdog.

Ofcom said its decision to fine HomeServe was "appropriate and proportionate" to reflect the seriousness of the breach and to act as a deterrent to it and other companies.

It added that it took into account steps taken by HomeServe to comply with the rules on silent and abandoned calls and its offer to compensate consumers who suffered harm from receiving the calls.

Ofcom's consumer group director Claudio Pollack said: "Our rules are there to prevent consumers suffering annoyance, inconvenience or anxiety from silent or abandoned calls.

"We hope today's fine will send a strong message to all companies that use call centres that they need to ensure they are fully compliant with the rules or face the consequences."

A HomeServe spokeswoman said: "HomeServe is reviewing the detailed determination.

"HomeServe identified the issue and promptly reported it to Ofcom following an internal audit of all of HomeServe's telemarketing operations. The problem was identified as having resulted from the incorrect use of answering machine detection (AMD) technology via an outsourcer.

"HomeServe can confirm that it no longer works with outsourcers on its outbound marketing and that AMD is no longer used in any calls made by the company.

"HomeServe can also confirm that all of its dialler systems have been fully compliant with Ofcom regulations since March 22 2011, following the rectification of the errors identified during HomeServe's audit.

"HomeServe is providing goodwill gestures of £10 to customers who received a silent, abandoned or repeat call from the referenced outsourcer over the relevant period. Anyone who believes they were subject to these over the relevant period should contact the company before May 31 2012 on 0800 389 5280 and the claim will be investigated.

"The above details will not have a material impact on HomeServe's financial results and the company's financial guidance remains consistent with the pre-close trading update of March 29."

Silent and abandoned calls from companies are usually generated by automated systems known as diallers and answering machine detection technology.

They are mainly used in call centres and connect the consumer to agents as soon as the phone is answered or disconnect calls made to answering machines.

Problems occur when the system dials more calls than agents can answer or ends an answered call by mistakenly identifying it as being picked up by an answering machine.

Communications Consumer Panel chairman Bob Warner welcomed the fine and called for continued close monitoring to stop others making silent and abandoned calls.

He said: "This is the first time that Ofcom has flexed its muscles to use the new enforcement powers. The panel has long lobbied for tougher action to protect consumers and we are now urging Ofcom to monitor closely the numbers of silent call complaints, and take further action where persistent silent calls remain a problem.

"Silent calls cause a great deal of anxiety, particularly for older people living alone. The higher fines mean that consumers should now be better protected."

Consumer Focus director of policy and external affairs Adam Scorer said: "Silent and abandoned calls are an annoyance and can often cause distress to the people who receive them.

"While they are usually caused by glitches in the technology rather than a deliberate act by sales staff, they are a nuisance and firms that do not control the technology show a lack of respect to consumers.

"All firms want to run efficient sales operations. But if finding cheaper ways of selling increases the risk of nuisance calls, then firms need to be very vigilant about the controls they put in place to manage that risk.

"We are pleased to see Ofcom take action and hope this serves as a clear warning to HomeServe and other companies to treat consumers with respect."

PA