Extensive survey of Premium SMS and Mobile Billing highlights collaboration to improve compliance in UK

In Compliance by Empello1 Comment

Extensive auditing of over 2,500 Premium SMS and Mobile Operator Billing services underscores need for compliance monitoring to minimise chance of consumer harm

Empello has today released a White Paper detailing results from one of the most extensive regulatory compliance programs of its kind globally. The program, carried out throughout 2013 on behalf of a UK Mobile Network Operator, audited over 2,500 UK Premium SMS and Mobile Billing services and found that the majority of premium rate services are 100% compliant with regulations.  Where services failed to meet regulatory requirements, this audit program included problem resolution, such that non-compliant services were made compliant within a few days. Hence, this industry-led program resolved problems before consumer harm was caused.

The program revealed: only six percent of audits resulted in a Red Card (cease service immediately), 16 percent had a Yellow Card (fix within two days), and 21 percent with a White (minor) Card. Analysing the data at a sector-by-sector level, it can be seen for example, that relevant non-compliance in the Psychic sector was at 24% in Q1 2013 and reduced to 7% by Q4 2013

A copy of the complete report can be downloaded here

The audit program used the PhonepayPlus Code of Practice and Guidance Notes as its “rule book” together with MNO-specific compliance and other legal requirements. Empello developed an online portal to record each audit, manage communications with the PRS provider’s mobile aggregator and coordinate problem resolution. UK MNOs already have a system of Yellow and Red Cards, issued for breaches where there is risk of modest to significant consumer harm. Empello added a White Card category to this system for minor breaches where the infringement would not result in material consumer harm. With more than 5,000 images captured, the Empello audit portal also serves as an important up-to-date database of PRS promotion.

Commenting on the White Paper, Jeremy Flynn, Director of Empello, said: “For the first time ever real data on the state of compliance within the UK demonstrates that when the industry works collaboratively significant improvements in compliance can be achieved without regulator intervention.”

Jonny Brown, MD of SB7, a PRS promoter commented: “A level playing field is important for our mobile business and indeed the whole sector. An industry-wide compliance program, enforced efficiently and fairly, helps ensure that all players follow the same rules and gives the market confidence to develop further and innovate in areas of promotion and new products.”

Rob Weisz, CEO of Fonix, a new payments aggregator commented: “It’s important that the industry itself works to ensure that consumers trust premium rate services. The industry has a responsibility to work through the value chain to nip non-compliance in the bud before consumers are harmed and heavy regulatory action is avoided”