ASA Adjudication on TAB Finance Ltd

Ad

An SMS text message, sent to private individuals' mobile telephones, stated "Hi X, it's Amy from Loan Finder. Can you please call us on 0800 XXX XXXX ASAP to discuss your recent loan application".

Issue

The complainant objected that:

1. the text message was misleading and inaccurate, because he had not applied for any loans recently, and

2. the text message was unsolicited.

3. The ASA challenged whether the text message breached the Code, because it did not give recipients an opportunity to opt out of receiving further marketing communications from Loanfinder.

CAP Code (Edition 11)

Response

1. & 2. TAB Finance said the words "recent loan application" in the text message referred to the fact that the complainant's details had been inputted on their own website, www.bestloans.co.uk. They sent a copy of their internal records on the complainant's loan application. It showed his name, address, phone number, the loan amount requested, the reason for the loan and the date and time the information had been received. They explained that data was not submitted to their systems from www.bestloans.co.uk unless the consumer submitted the application by pressing the "Get a quote today!" button on the website. They said many loan applications were submitted by that method every day, and they had no way of knowing whether the details were genuine or fraudulent until some form of contact was made with the applicant. They therefore treated every application as a genuine loan enquiry. Because the complainant had told the ASA he had not applied for any loans recently, TAB Finance said they could only assume that his details had been submitted on their website fraudulently. They confirmed that the complainant's details had now been permanently suppressed on their system and he would not receive any marketing communications from them in the future.

TAB Finance said the 0800 phone number in the text message, which recipients were asked to call to discuss their "recent loan application", was Loanfinder's, not theirs, because they marketed their own data on Loanfinder's behalf as an affiliate partner: they introduced customers to Loanfinder.

3. TAB Finance explained that, because the enquiry was generated via their own website, which included an 'opt-out' route as part of their privacy policy, they had not provided an opportunity to opt out of receiving further marketing communications in the text message itself. However, they acknowledged that that was an error on their part, and stated that all future text messages would direct recipients to text "STOP" to a given number if they did not want to receive further marketing communications.

Assessment

1. Upheld

The ASA considered that, when sending the text message, TAB Finance had good reason to believe the complainant had applied for a loan recently, because his details had been submitted on their own loan application website. We were concerned by the idea that his details might have been submitted fraudulently, but acknowledged that TAB Finance did not know that at the time of sending out the text message.

We noted the www.bestloans.co.uk website stated that it had access to various loan providers and compared many different loan plans, and consumers who submitted applications would receive a call from a loan provider. We considered that anyone who had applied for a loan on www.bestloans.co.uk might therefore expect to be contacted by a third party loan provider to discuss their application.

However, we considered that recipients of the text message would infer that it had been sent by Loanfinder, whereas it was generated and dispatched by TAB Finance. We understood that, although Loanfinder had a working relationship with TAB Finance, they were not aware that the text message had been sent and their databases and systems contained no record of the complainant. We did not know why TAB Finance had not informed Loanfinder that they had directed recipients of the text message to call them, because that meant recipients might make costly phone calls to Loanfinder only to find that they held no record of their loan application and no knowledge of the text message. If the object was merely to introduce the customer to Loanfinder, we considered TAB Finance had done so in a way that was likely to confuse both parties. Because the text message directed the recipient to contact Loanfinder even though that company would have no record of the recipient or his loan application and no knowledge of the text message itself, we concluded that it was misleading and inaccurate.

On this point, the text message breached CAP Code clause 7.1 (Truthfulness).

2. Not upheld

We noted the Code stated that marketers could send unsolicited marketing about their similar products to consumers whose details they had obtained in the course of, or in negotiations for, a sale (subject to the condition described below). Because TAB Finance had obtained the complainant's details in negotiations for the sale of a loan product, we considered it was acceptable for them to send him unsolicited marketing about their own similar products (subject to the condition described below). We understood from the complainant that he had not, in fact, submitted his details in an application for a loan on TAB Finance's website www.bestloans.co.uk, but considered that it was justifiable for TAB Finance to conclude that he had at the time of sending the text message. Although TAB Finance's internal records showed that not every question on the website application form had been completed, we noted the complainant's contact details and information about a required loan had both been inputted. We also understood that the application had actually been submitted, because the data would not have been received otherwise. We therefore considered it was reasonable for TAB Finance to assume that the complainant had submitted his details to them in negotiations for a sale.

On this point, we investigated the text message under CAP Code clause 43.4 (Direct marketing rules - Database practice) but did not find it in breach.

3. Upheld

We noted the Code stated it was acceptable for marketers to send unsolicited marketing about similar products to consumers whose details were obtained in the course of, or in negotiations for, a sale, on the condition that they provided a simple means of opting out of future marketing both when they collected the data and on each occasion they sent out marketing communications. Although TAB Finance had provided an 'opt-out' route on their website at the time the data was collected, they had not done so in the text message itself, which was a breach of the Code. We welcomed TAB Finance's assurance that future text messages would provide recipients with a means of opting out of receiving further marketing.

On this point, the text message breached CAP Code clause 43.4 (Direct marketing rules - Database practice).

Action

The ad must not appear again in its current form. We told TAB Finance not to send marketing communications directing recipients to call companies which had no record of their details or loan applications and no knowledge of the marketing communication itself. We also told them to ensure that any future text messages provided recipients with a means of opting out of receiving further marketing.

Adjudication of the ASA Council (Non-broadcast)