Are you being investigated?

We gather intelligence from a wide variety of sources. Intelligence sources can include information from consumers, monitoring and research, information that has been gathered through our regulatory activities such as supervision, stakeholder management or registration and verification activity. We may also gather intelligence from industry reports, information provided to us by third parties including other enforcement bodies and whistleblowing channels. We analyse the intelligence that we receive to identify whether there are concerns which need to be resolved.

We aim to resolve as many issues as we can without resorting to an investigation using our engagement and enforcement processes. However in some cases we will take the view (applying the criteria set out in the Code and our published Procedures) that it is necessary to open an investigation using either the engagement or enforcement processes. 

The engagement process aims to resolve matters quickly with the full co-operation of the premium rate service provider without the need for sanctions to be imposed. The enforcement process is reserved for matters where there is a likely need to sanction non-compliance with the code in order to uphold industry standards and deter bad practice. 

The criteria that we consider in deciding whether an issue should be investigated using the engagement or enforcement process is set out in our Procedures. It includes:

• the seriousness of any apparent breach 
• the gravity of any consumer harm and whether such harm is ongoing
• the breach history of the PRS provider
• the extent to which the PRS provider has engaged with the PSA and the likelihood of engagement going forward 
• whether there are any other strategic reasons to undertake either enforcement or engagement actions. This may include, but is not limited to, consideration of whether either engagement or enforcement will improve market behaviour, achieve credible deterrence in respect of the industry and improve consumer confidence in the industry.

We strongly encourage service providers to co-operate with the PSA where a concern has been identified as this is likely to result in a quicker resolution of any issue.

As a service provider, it is your responsibility to ensure that you are complying with the Code and any relevant issued guidance. You should also ensure that you co-operate with us when we contact you in relation to an investigation. Failure to do so could amount to a further breach of our Code.

Where a matter has been referred to engagement, we will notify you. We may send out an enquiry letter which asks for more information, or where we have the information that we need already, we may send you a warning letter straight away. In all cases we will provide you with an indication of how long we expect the engagement process to take.

If we do send you an enquiry letter, it is important that your respond and provide the information that we have requested. If you do not respond, this could amount to further breach of the Code being raised. 

A warning letter will set out the apparent breaches that we have identified, and, in most cases, it will also contain a proposed action plan to resolve the issue. The nature of an action plan will vary depending on the type of concern/apparent breaches that have been identified, however in all cases, we will set out the actions that we expect you to take to resolve the issues and a timeframe for when we expect those actions to be implemented. 

We will ask you for a response to the warning letter and will ask you to confirm that you agree to the action plan. If you do agree to an action plan, extracts of the warning letter including the action plan may be published on the website.

In all cases, we will monitor your compliance with the warning letter and/or action plan. If further issues arise or the plan is not fully implemented this could result in enforcement action being taken.

If you do not respond to the warning letter or do not accept the terms of the action plan, we may consider referring the matter to enforcement.

For more details on or engagement process, please refer to our Code and Procedures.

If an issue has been referred to enforcement, we will send you a formal notification. This will set out details of the apparent breaches that we have identified and give an indication of how long we think the investigation might take.

We publish on our website a list of all open enforcement investigations.

During the course of an enforcement investigation, we will send you directions for information which you will need to respond to within the deadline set. If you are unable to provide the information requested or need longer, it important to get in touch with us as soon as possible. If you do not respond, this could lead to further breaches being raised against you. 

You can also send us any information that you would like us to consider as part of the investigation which it is ongoing even if we do not ask for it.

When the investigation is complete, we will in most cases send you an enforcement notice which will include details of the alleged breaches and the evidence that we have gathered. The enforcement notice will also set out the sanctions that we are recommending. 

We will provide information on how to respond to the enforcement notice and a deadline for a response. Normally this will be 10 working days, but it could be longer where a case is more complex. If you need longer to respond, please ensure that you get in touch with us and request an extension. 

At any stage during the enforcement investigation, you can ask us to consider a settlement proposal. Further details of our settlement process can be found in the Code and section 12 of the Procedures. 

Unless a settlement has been agreed between the parties (prior to any request for an oral hearing) enforcement cases will usually proceed to either a full Tribunal or single legally qualified CAP member for adjudication. The Tribunal or the single legally qualified CAP member will decide whether the breaches have been made out on the balance of probabilities and if so, what sanctions should be imposed.

Most cases will take place using the paper-based process. This process means that the case is considered largely on the papers without witnesses being called. However, you can still ask to attend a paper-based Tribunal to make oral representations to the Tribunal in order to clarify your case. The Tribunal is also able to ask you questions and to ask the PSA any questions that it might have to clarify matters. 

Some cases may be considered suitable for adjudication by a single legally qualified CAP member using the paper based process. Single legally qualified CAP members can only impose a limited range of sanctions and providers cannot make oral representations to a single legally qualified CAP members at a paper-based hearing. If we think that your case might be suitable for consideration by a single legally qualified CAP member, we will inform you when we send you the enforcement notice and you will have a chance to respond. 

Alternatively, you can request that your case is dealt with using the oral hearing process instead of the paper-based process. This is a more formal process which involves the calling of witnesses who are cross examined by lawyers acting for the parties. Not all cases will be considered suitable for an oral hearing under the new Code. 

For more details, please refer to sections 13 and 14 of the Procedures.

The PSA has a range of powers in the Code which it can use at any point during an investigation but before any final adjudication of potential breaches of the Code takes place. 

The powers include directing suspension of a service (for example, where there is serious harm or risk of harm to consumers requiring urgent corrective action), and directing that service revenue be withheld (where, for instance, there is evidence that a provider cannot or will not comply with any financial sanction that may be imposed in due course). These are known as ‘interim measures’. The decision to impose interim measures is made by a Tribunal.

If interim measures are considered to be appropriate, the PSA will follow the relevant procedures as set out in paragraph 5.6 of the Code and section 11 of the Procedures. 

All cases that are referred to either engagement or enforcement are regularly reviewed in order to ensure that we are using our resources in the most effective way to prevent consumer harm and deter poor practice. 

In some cases, as we investigate a matter, we may gather evidence which undermines our case on an apparent breach. In such cases we may decide to take no further action either in relation to the case as a whole or in relation to one or more of the breaches that we initially identified. If this results in a decision to take no further action in relation to the case as a whole, we will write to you to confirm this. Where relevant we will also amend the list of our open investigations on our website to ensure that it takes account of our decision.

In other cases, even where we are of the view that there is enough evidence to raise a breach (or breaches) we may still decide to de-prioritise a case and take no further action in line with our prioritisation principles. The principles that we consider are:

• the likely impact of any engagement or enforcement activity on consumers and the wider industry 
• whether there are any strategic considerations that we need to take into account
• the risks of proceeding/taking no further action
• resource implications.

The Procedures contain more details on how we apply these principles to a case.

If a Tribunal decides that a breach of the Code has occurred, it can impose one or more of the following sanctions:

• issue a reprimand and/or warning
• order a provider to give refunds to consumers who have requested one. In more serious cases refunds can be ordered for all consumers without the need for them to ask for one
• impose a fine, up to a maximum of £250,000 per upheld breach of the Code
• bar access to the service for a defined period or until compliance advice is satisfactorily implemented
• require a provider to remedy a breach of the Code
• require a provider to obtain compliance advice or permission to run a service
• require a provider to submit to a compliance audit of the service carried out by a third party
• prohibit a provider or individuals associated with the provider from having involvement in some or all phone-paid services, or contracting with a specific party, for a defined period.

If a single legally qualified CAP member decides that a breach of the Code has occurred, it can impose one or more of the following sanctions:

• issue a reprimand and/or warning
• order a provider to give refunds to consumers who have requested one
• require a provider to remedy a breach of the Code
• require a provider to obtain compliance advice or permission to run a service
• impose a fine, up to a maximum of £250,000 in total.

Where a single legally qualified CAP member is of the view that other sanctions are appropriate and proportionate, they may refer the matter to a full Tribunal.

If a provider disagrees with a decision made by a Tribunal or single legally qualified CAP member on the breaches and/or sanctions, it can contact the PSA and ask for a review of the decision by a differently constituted Tribunal. Unless there are exceptional circumstances, the request must be submitted within 10 working days of publication of the decision. Applications for review must be in writing and specify which of the four permitted grounds for review apply.

For more details on the review process please refer to paragraph 5.10 of the Code and section 17 of the Procedures.