ASA Adjudication on The Insolvency Advisory Service LLP

Ad

A fax, for The Insolvency Advisory Service, was headed with an official looking crest and text stating "This could be a PAYMENT DEMAND From HM Revenue and Customs". Below, it stated "Financial difficulties - Money Problems - salaries to pay - these are all reasons why you may need help. Debts to creditors mount up daily at an alarming speed - what can you do to stop this? .... Our role is to protect you, however the role of an Insolvency Practitioner when acting as liquidator or trustee is to defend the rights of everybody who is owed money by you - in addition they have a duty to investigate all your dealings! And .... he can make you personally liable for all the debts even if your business is a limited company! We are duty bound and licensed to protect you - your business and your family! ...". Text near the bottom of the fax stated "This may not reflect your circumstances or indeed be of any relevance to you - if that is the case we apologise for taki [sic]".

Issue

1. Two recipients believed the fax was misleading, because it gave the impression that it was from HM Revenue and Customs (HMRC) and appeared to be an official demand for payment.

2. One of the complainants believed the fax was alarmist and likely to cause distress to recipients, particularly those in financial difficulties.

CAP Code (Edition 11)

Response

The Insolvency Advisory Service (IAS) denied that the fax received by the complainants had originated from them.  They said they did not send out such faxes by e-mail and were of the opinion that the fax was not part of their promotional material.  They said "Therefore we can only come to the conclusion, as must you that these purported faxes did not come from us".  They did, however, confirm that the fax was similar to some they had used in the past.

Assessment

The ASA noted IASs assertion that the fax did not originate from them.  However, we also noted that, in their initial response, they had not denied the fax was theirs.  They said they were concerned that the ASA had received two complaints, which they believed ... strange bearing in mind that over 4 million have been sent out over an 8 year period".  We understood that they had used a similar fax in the past but they refused to tell us when they last used it.  Because the complainants believed the fax was from IAS, IAS had used similar faxes in the past and there seemed to be no reason why anyone else would send a fax advertising the services of IAS, we continued with our investigation on the assumption that IAS sent the fax.

1. Upheld

We noted the fax appeared to be a payment demand from HMRC, with an official-looking crest and large text stating "PAYMENT DEMAND From HM Revenue and Customs".  Although smaller text above the claim stated "This could be a" (payment demand) we considered that, because it was much smaller in size than the main headline, it was likely to be initially missed by recipients. We considered that, because it was not immediately clear that the fax was advertising material, it was likely to mislead recipients into believing that they had received a payment demand from HMRC.  

On this point, the fax breached CAP Code clauses 7.1 and 7.2 (Truthfulness).

2. Upheld

We considered that, because the fax appeared to be a payment demand from HMRC, it was likely to cause undue fear and distress to recipients.

On this point, the fax breached CAP Code clauses 9.1 and 9.3 (Fear and distress).   

Action

The fax must not be used again in its current form.  We told IAS to seek CAP Copy advice before advertising again.

Adjudication of the ASA Council (Non-broadcast)