Page last updated at 08:18 GMT, Monday, 26 May 2008 09:18 UK

New rules for consumer protection

Scam artist
The internet has been used by scam artists to con people out of money

A new law aimed at protecting consumers against rogue traders has come into force in the UK.

For the first time in UK law there will be a duty on all businesses not to trade unfairly.

The law aims to tackle everything from aggressive sales tactics by rogue builders to bogus closing-down sales.

Fortune-tellers, astrologers and mediums are among those affected by the rules, which require them to say their services are for "entertainment only".

Some 31 specific practices will now be banned, and the law's wider duty not to trade unfairly is intended to avoid the need for a new law to cover every new scam.

However, unlike in Ireland, the rules do not extend so far as allowing disgruntled customers to claim compensation when businesses treat them unfairly.

Carl Belgrove from the National Consumer Council welcomes the changes

And concerns have been raised that there are not enough trading standards officers to police the new scheme effectively.

Carl Belgrove, of the National Consumer Council, said the new rules were a welcome change in the law after 20 years of campaigning by support groups.

"These new laws represent a big boost to consumer protection, particularly for vulnerable people who are targeted by rogue traders," he said.

Harry Hodder, a retired factory worker from Nottingham, is one such person. He spent 250 replying to bogus prize draw letters promising him millions.

"One promised 75,000 was owed to me and I thought I could get my own bungalow, but now I know where this junk mail goes the shredder," he said.

"What a way to blackmail people into parting with their hard-earned money."

The new legislation outlaws information which, even if it is factually correct, deceives the average consumer into making a transaction he or she would not have taken otherwise.

Wide-ranging law

The Consumer Protection Regulations, which implement the EU directive on unfair commercial practices, mark the biggest shake-up in consumer law for 40 years.

This brings in a new concept of fairness, a brave new world for businesses dealing with consumers and advertising
Lawyer Philip Carnell

As well as a duty for companies not to trade unfairly and to avoid misleading statements or omissions, there is also a duty on businesses not to conduct aggressive sales practices, such as harassment, coercion and undue influence.

This would tackle cases such as the pushy sales tactics Vivien Herbert said she had to endure.

Ms Herbert said a solar panel salesman got very annoyed and called her a timewaster when she pointed out that she was not going to sign up for a system costing thousands of pounds during his first visit.

But the wide-ranging nature of the regulations mean that they will also cover issues such as fake testimonials by "customers" giving favourable reviews of products, holidays or shows.

"This brings in a new concept of fairness, a brave new world for businesses dealing with consumers and advertising," said lawyer Philip Carnell of CMS Cameron McKenna.

"If marketing companies are going to try and be sneaky, that will now be a strictly liable criminal offence."

Brought to justice

Some of the 31 specific unfair sales tactics used by companies that are covered in the legislation overlap existing rules.

They also include advertising products knowing there is insufficient stock to meet demand, falsely claiming that customers would get a better deal if they signed up immediately, and directly targeting children to say they would be disadvantaged without a certain product.

Trading standards officers will be policing the new regulations. They could concentrate on the most prevalent complaints such as second-hand car sales and property repairs.

David Sanders, lead officer for civil law at the Trading Standards Institute, said that the more serious cases were likely to be dealt with under criminal law.

This would mean maximum penalties of up to 5,000 for anyone found guilty in a magistrates' court, or a fine of up to 5,000 and/or two years in prison in cases heard in a Crown Court.

But Mr Sanders had a word of caution for consumers expecting all con-artists to face justice.

"We are a limited band of people and we are only going to investigate the most serious cases," he said.

And Mr Sanders added that, especially in the smallest local authorities, there were not enough trading standards officers and they were not well enough resourced to conduct in-depth investigations into every potential breach of the rules.

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