Page last updated at 16:05 GMT, Thursday, 8 November 2012

Debate on claims management companies

Claims management companies (CMCs) have been accused of being "overly aggressive", during a Westminster Hall debate on new rules on regulation.

Opening the debate on 8 November 2012, Conservative MP Jackie Doyle-Price said "well-behaved" CMCs had "nothing to fear" from tougher rules.

The government has announced that people who are let down by claims management companies will now be able to complain to the Legal Ombudsman.

The Ombudsman will take over dealing with complaints about individual CMCs from the Ministry of Justice's Claims Management Regulation Unit in 2013.

Claims firms have been blamed for stoking up thousands of bogus claims against banks for the mis-selling of payment protection insurance (PPI).

CMCs advertise widely on TV, newspapers and the internet, encouraging people to sue for personal injury compensation, and for other losses.

However, individuals can make a PPI claim themselves for nothing.

Conservative MP Jonathan Evans said if people had been wronged by the banks, it was "unacceptable" that they should be wronged a second time, accusing some CMCs of "siphoning off" part of their clients' entitlement.

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