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Spam Texts £300,000 Penalty Overturned

A marketing company boss who was the first person to be fined under anti-spam texting laws has had his £300,000 penalty overturned by the First-Tier Tribunal on the basis that his activities, whilst no doubt irritating, were unlikely to have caused substantial distress to mobile phone users.

The businessman was part of a growing industry in which vast numbers of texts were sent to members of the public to promote personal injury and PPI mis-selling claims. Through his company, he had operated on an ‘industrial scale’, using unregistered SIM cards to send hundreds of thousands of unwanted messages.

Although the use of texts for direct marketing purposes without recipients’ consent had been outlawed in 2003, there was no evidence that the businessman had made any efforts to obtain such consents. He also had not bothered to register with the Information Commissioner (ICO) as a data controller under the Data Protection Act 1998.

The Privacy and Electronic Communications (EC Directive) Regulations 2003 had conferred a private right to seek compensation on individuals who could prove that they had suffered damage as a result of receiving offending texts. However, it was only in May 2011 that the ICO was given power to impose penalties up to £500,000 in such cases. The businessman was the first to receive such a fine.

The Tribunal acknowledged that mobile phone users would no doubt have given ‘a tut of irritation’ on receipt of the texts. However, it noted that, although a very large number of messages had been identified in the penalty notice, only 286 of them had been sent after the ICO was granted the power to impose monetary penalties.

The ICO argued that recipients would have suffered damage in terms of time wasted and because of charges that they would have incurred in attempting to stop the unsolicited texts. However, the Tribunal concluded: “The effect of the contravention is likely to be widespread irritation, but not widespread distress.

“Given the scale of the contravention, there is the possibility of some distress in very unusual circumstances, but we cannot construct a logical likelihood of substantial distress as a result of the contravention. We conclude that the contravention is not of a kind likely to cause substantial distress. Our decision, therefore, is to cancel the penalty notice.”