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Are you being investigated?

We aim to resolve as many issues as we can informally, and with the full co-operation of service providers. We receive complaints from consumers as part of our day-to-day operations and will frequently enquire with service providers when there appears to be consumer harm or some other non-compliance with our Code.

We only launch a formal investigation when we believe (through assessment of criteria set out in our Code and our Supporting Procedures) that the particular harm or breach of our Code warrants it. On average 83% of our cases were resolved informally without the need for a full investigation, thereby saving time and money for everyone and advancing the best interests of consumers.

We strongly encourage service providers to co-operate with the PSA when we get in touch about a service.

As a registered service provider, it is your responsibility to ensure that you are complying with the Code, Special conditions and any 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 may be a breach of our Code or considered as an aggravating factor.

How investigations work

Investigation stages (graphic)

When we receive complaints from consumers we will consider them. Where we identify phone-paid service that appear to not comply with the Code of Practice we investigate them. Depending on the issues identified, and our consideration of criteria set out in the Code and Supporting Procedures, we may decide to give the service provider the opportunity to remedy the Code breach without carrying out a formal investigation under the Code. In more serious cases, we will normally carry out a formal investigation under the Code: this will take the form of either a Track 1 or a Track 2 procedure.

Review of interim measures form PBC

Stages of an investigation:

In the initial stage of an investigation we try to understand the complaints (or PSA monitoring) and the service and make enquiries of the phone-paid service provider. Where possible, the PSA will informally notify a provider of any initial concerns we may have, usually in the form of an email or letter. Upon receiving such notification, we would expect the service provider to take the opportunity to address any apparent issues, which may include seeking and acting upon compliance advice. Whilst taking such action does not automatically mean that PSA will not carry out a formal investigate under the Code, it will help to remove or reduce any ongoing harm. This is likely to be considered a mitigating factor if the matter is considered formally under the Code at a later stage.

If providers do take remedial action, we recommend that they provide us with evidence that they have done so. If the evidence is sufficient and there are no other concerns identified, we may decide that no further action is necessary.

If the issues are not resolved in the enquiry stage, then we may look to investigate the issues formally, that is under the Code. When deciding how best to investigate a service under the Code, we will consider the allocation criteria set out in the Code and Supporting Procedures.

These include the seriousness of any apparent breaches, whether the provider has taken effective steps to remedy any consumer harm and ensure that the service does not still have potential to cause harm, the breach history of the provider, and the level of cooperation we consider is likely to be received from the provider.

When our investigations indicate that an apparent breach of the Code has taken place, we may use the Track 1 procedure. This is for apparent breaches that cause little or no consumer harm or offence to the public and we believe are not appropriate to be dealt with informally.

The intention of a Track 1 investigation is to fully understand the issues affecting the service and remedy the apparent breaches through a formal action plan agreed with the service provider. Track 1 procedures do not result in a Tribunal, but non co-operation from the service provider may cause an investigation to be upgraded to a Track 2 procedure (see below). In Track 1 cases, we will:

  • contact the provider and inform it of the apparent breach of the Code
  • agree an action plan with the provider to remedy the apparent breach(es) of the Code identified and prevent repetition
  • require the provider to demonstrate to the Phone-paid Services Authority that the action plan has been implemented.

For more serious cases, we will follow the Track 2 procedure. This is for breaches of the Code that we consider are not suitable for the Track 1 procedure, such as where actual or potential consumer harm is more serious or there has been a serious failure to comply with a regulatory requirement (e.g. a Tribunal sanction).

The Track 2 procedure is intended to enable a detailed consideration of the promotion and service and gathering of evidence that can be shared with the provider and/or presented to a Tribunal if necessary. In these cases, we will:

  • send the provider a Warning Notice that sets out the apparent breaches of the Code and evidence we have relating to the service or promotion, together with our recommendations for appropriate sanctions. The provider will be asked to respond to this within a reasonable period of time; this is normally 10 working days but may be extended to 20 working days in exceptional circumstances.
  • Where appropriate refer the case to a Tribunal to consider whether or not there has been a breach of the Code, and if so, what sanctions to impose. Where a case is proceeding to Tribunal a provider may request an oral hearing instead of the case being considered on the papers. Details of the procedures governing oral hearings are set out in Annex Three of the Code.
  • Where breaches of the Code are agreed by the provider or we accept the evidence or arguments of the provider in relation to the alleged breaches or proposed sanctions, we and the provider may agree for the case to be settled without the need for a Tribunal to consider it in full. In such cases the Tribunal will uphold the agreed breaches and sanctions, unless there are exceptional reasons not to. This is know as an 'adjudication by consent'. 

Urgent actions we may take during investigation

The PSA has a range of powers in the Code which it can use at any point during an investigation - before any formal 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 4.6 of the Code.

Tribunal decisions and sanctions

If a Tribunal decides a provider has breached the Code, it can impose one or more of the following sanctions as are appropriate and proportionate:

  • issue a reprimand and/or warning
  • order a provider to give refunds to specified or all consumers, subject to making a claim to the provider. In more serious cases refunds can be ordered for all some or all consumers without the need for a claim
  • impose a fine, up to a maximum of £250,000 per upheld breach of the Code or for the combined breaches upheld
  • bar access to the service for a defined period or until compliance advice is satisfactorily implemented
  • require a provider to remedy the 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
  • ban a provider or individuals associated with the provider from running involvement in some or all phone-paid services, or contracting with a specific party, for a defined period.

The PSA will impose administrative charges towards the costs incurred by it in bringing cases to a conclusion. This power is set out at paragraph 4.11 of the Code of Practice.

Can Tribunal decisions be reviewed?

If a provider disagrees with a decision made by a Tribunal on breaches and/or sanctions, it can contact the Executive and ask for a review of the Tribunal decision by a differently constituted Tribunal. Except in 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.

Procedures relating to reviews can be found at paragraph 4.10 of the Code. Further detail can be found at paragraphs 272 to 279 of the Supporting Procedures.

Why would the PSA request information from you?

There are a number of reasons why the PSA may contact a Level 1 (L1) or Level 2 (L2) provider for information regarding the promotion, operation or content of a premium rate service. We may request information at the enquiry stage of an investigation or during a formal investigation under the Code. Where it is the latter we will do this under paragraph 4.2.1 of the Code. See the Supporting Procedures for further details as to when we will contact a L1 or L2 provider after receiving a complaint or initiating an investigation. A request for information at the enquiry stage does not mean that a company, person or service is under formal investigation.

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