Emergency Procedure Investigation

News /

PhonepayPlus, the phone-paid services regulator, has launched an investigation following correspondence received from Stockport Metropolitan Borough Council regarding nine complaints it has received from members of the public.  Having contacted the Network Operator through whose network the service operates, PhonepayPlus considers the Service Provider responsible under the PhonepayPlus Code of Practice to be 'Digital Select Limited.'

The complaints relate to a letter received by the complainants from a debt recovery company called 'Redstone Recovery Ltd.'  The letter refers to an outstanding debt balance and states that legal proceedings will be taken against the complainant if payment is not made within seven days. The letter contains a premium rate number and asks the recipient to call the number to agree a payment plan in order to clear the outstanding debt.

Due to the very serious nature of the alleged breaches of its Code of Practice, PhonepayPlus has invoked its emergency procedure to bar access to the number associated with the service with immediate effect.  In addition, all revenue payable to the Service Provider has been withheld by the Network Operator pending the outcome of the investigation.

However, following further discussions with Stockport Metropolitan Borough Council, PhonepayPlus has become aware that the address for Redstone Recovery Ltd which appears on the promotional letter does not exist. In order to prevent further consumer harm whereby consumers are concerned about this apparent debt, but find themselves in a position where they are unable to contact someone to discuss it, PhonepayPlus has asked Digital Select Limited to reactivate the line with a recorded message which informs callers that Digital Select does not deem the debt recovery service to be legitimate and to disregard the letter. The recording also states that the service is currently under investigation. In addition, callers are directed to the Service Provider's non-premium rate customer service number should they require further information.

PhonepayPlus regulates premium rate service providers, which are defined in paragraph 11.3.6 of the PhonepayPlus Code of Practice (Eleventh Edition Amended April 2008).

Background The service is charged at £1.50 per minute from landlines, and potentially considerably more from mobile phones. It is brought to the attention of consumers when they receive a letter delivered to their home.  Complainants are concerned this is not a genuine debt collection notice and the company is not a genuine debt collection agency.

Mark Burcher