Photo Credit: Iain Watson
Ofcom opened an investigation last year into Homeserve as part of its monitoring and enforcement programme, to reduce harm caused to consumers by silent and abandoned phone calls.
Silent and abandoned calls can be generated by predicative diallers and answer machine detection (AMD) technology. The automated dialler systems are often used in call centres. The technology can cause problems when it mistakenly ends a call a person has answered because it identifies the call as being picked up by an answer machine.
The technology is useful to call centres as it connects the consumers to agents as soon as the phone is answered but its faults can cause anxiety to consumers who receive the silent or abandoned calls.
In the UK, Ofcom requires that predictive dialers abandon less than 3% of all answered calls. If an agent is not available within 1 second the call is considered "abandoned" and an automated message is played. The automated message must identify the company making the call, the purpose of the call, a free phone or basic rate phone number to call back on and must not contain any form of marketing. In the UK "abandoned" calls must not be called back within 72 hours unless there is a dedicated agent available.
Ofcom also limits the amount of abandoned calls a company is able to make to consumers. The investigation into HomeServe revealed the company exceeded the call rate on 42 occassions. Between February and March 2011 HomeServe made estimated 14,756 abandoned calls to consumers.
Ofcom believes the £750,000 financial penalty is appropriate for HomeServe and hopes this will act as a warning to other companies who must comply with the rules.
"Our rules are there to prevent consumers suffering annoyance, inconvenience or anxiety from silent or abandoned calls," said Claudio Pollack, Ofcom’s Consumer Group Director.
"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."
The Communications Consumer Panel Chair Bob Warner fully supports Ofcom’s decision to use its power to fine HomeServe and believes close monitoring should continue to stop other companies as well.
"This is the first time that Ofcom has flexed its muscles to use the new enforcement powers," said Warner.
"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."
The Panel advised the Government in 2010 that silent and abandoned calls continued to cause significant harm to consumers, and called on Government to raise the maximum penalty for persistent misuse of automated calling systems and services to £2 million. The Department of Business, Innovation and Skills (BIS) agreed with the Panel and gave Ofcom the powers to impose higher fines up to £2m.
"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," said Warner.
Tony Hesketh, Director of Solutions Consulting at Aspect says that companies need to be careful when using outbound dialling.
"It’s astounding that almost four years after Ofcom announced the original ruling on silent calls, some organisations are still suffering from the mis-application of the same technology, such as the outbound automatic diallers and answer machine detection, that is designed to ensure compliance and eradicate silent and abandoned calls," said Hesketh. "In the right hands, outbound dialing is a highly effective marketing and sales tool. In the wrong hands, however, it can be a persistent menace to consumers and businesses, as we have seen this week."
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