Extensive auditing of over 2,500 Premium SMS and mobile operator billing services underscores need for compliance monitoring to minimise chance of consumer harm
March 11th 2014. Empello, a provider of compliance services to the mobile industry, has released a White Paper detailing results from one of the most extensive regulatory compliance programmes of its kind globally. The programme, carried out throughout 2013 on behalf of a UK MNO [Mobile Network Operator], audited over 2,500 UK Premium SMS (PRS) and mobile billing services and found that the majority of premium rate services are 100 per cent compliant with regulations. Where services failed to meet regulatory requirements, this audit programme included problem resolution – such that non-compliant services were made compliant within a few days. Hence, this industry-led programme resolved problems before consumer harm was caused.
The programme revealed: only six per cent of audits resulted in a Red Card (cease service immediately), 16 per cent had a Yellow Card (fix within two days), and 21 per cent 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 per cent in Q1 2013 and reduced to 7 per cent by Q4 2013
The audit programme 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
Commenting on the White Paper, Jeremy Flynn, a director with 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 with SB7, a PRS promoter commented, “A level playing field is important for our mobile business and indeed the whole sector.”
“An industry-wide compliance programme, 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.”
A copy of the complete report can be downloaded here.
Empello delivers risk management regulatory compliance in the mobile and online sectors. Bringing an unrivalled level of regulatory experience, it provides compliance expertise; ad monitoring; service testing; bespoke technology and brand protection.