Telecoms watchdog fines HomeServe £750,000 over silent calls

HOME insurance and maintenance group HomeServe has been fined £750,000 by telecom watchdog Ofcom for making an excessive number of silent and abandoned calls to its UK consumers.

Ofcom had opened an investigation into Walsall-based HomeServe last year as part of its monitoring and enforcement programme aimed at reducing harm caused to consumers by silent and abandoned calls.

Under Ofcom’s rules, there is a limit on the number of abandoned calls that companies are permitted to make to consumers. Ofcom’s investigation into HomeServe found the company exceeded this abandoned call rate on 42 separate occasions during the period February 1 and March 21, 2011. This resulted in estimated 14,756 abandoned calls being made to consumers.

Ofcom rules also prohibit companies from making repeat calls to specific numbers within the same 24-hour period, where a call has been identified by answer machine detection (AMD) technology as having been picked up by an answer machine. Ofcom found that HomeServe made breached this 36,218 times during the period.

In reaching its decision, Ofcom said it had taken into account a number of factors including, the steps taken by HomeServe to bring itself into compliance with the rules on silent and abandoned calls, and its offer to compensate consumers who suffered harm from receiving silent and abandoned calls as a result of its breach of the rules.

“Ofcom has decided that it is appropriate and proportionate to impose a financial penalty on HomeServe to reflect the seriousness of their breach, and to act as a deterrent to them and other companies who must comply with the rules,” said the watchdog in a statement.

HomeServe said it had identified the issue and reported it to Ofcom following an internal audit of all of HomeServe’s telemarketing operations.

The problem was said to have been caused by incorrect use of AMD technology via an outsourcer. The company said it no longer worked with the outsourcer on its outbound marketing and that AMD was no longer used in any calls made by the company.

HomeServe said it had also taken steps to ensure all of its dialler systems were fully compliant with Ofcom regulations and the firm is making goodwill payments of £10 to customers who received a silent, abandoned or repeat call during the period.

It said the action would not impact on its financial results and its guidance remained consistent with that contained in a pre-close trading update on March 29.

In October last year, the company suspended all its marketing calls in order to retrain staff following claims of mis-selling.