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Unfortunately, prosecutions of illegal house-to-house collections are extremely rare.
As far as we know, this is the only case where the Office of Fair Trading has been involved.
Nicholas Rees was prosecuted on 11 June 2004 by the Licensing Department of Birmingham City Council - for carrying out an unlicensed charitable collection (of clothes) - an offence under the House to House Collections Act 1939.
He was fined £500 and costs of £430 were awarded against him.
"BIRMINGHAM CITY COUNCIL
REPORT OF THE SENIOR ASSISTANT DIRECTOR (REGULATORY SERVICES)
TO THE LICENSING COMMITTEE
PROSECUTIONS - 1ST APRIL 2004 - 31ST JULY 2004
4.2 Nicholas Rees, [address], Smethwick
On 11th June 2004, at Birmingham Magistrates' Court, the defendant was found guilty in his absence, of 1 offence under the House to House Collections Act 1939 of acting as a collector for a charity without a licence authorising him to do so.
Fined £500, Prosecution Costs £430, Total £930
(The maximum penalty for this offence is a fine not exceeding £500 and/or 3 months imprisonment) "
This case was unusual (and probably unique) - as follows. Having successfully prosecuted the collector, the Council pursued the matter further. They felt that he was likely to continue flouting the law. So they referred his case to the Office of Fair Trading (the OFT). (Note: The OFT is part of central government (Whitehall etc) in London.)
The Council asked the Office of Fair Trading to take action under the Control of Misleading Advertisements Regulations (the CMARs) 1988. The OFT obliged - and they persuaded the collector to give written undertakings to the OFT under these Advertisements Regulations. These undertakings (ie promises) are legally enforceable through the courts.
We urge the regulators to use these little-known powers more often.
In 2008 these powers were transferred to the Consumer Protection Regulations 2008 (the CPRs). These are administered by council trading standards departments.
For more on this case, see :
Extracts from the OFT's press release of 17 December 2004
(our thanks to the OFT; bold added by us) :
"OFT stops collector involved with deceptive 'charity' adverts
A door-to-door collector of donated clothing has been stopped by the OFT from being involved with misleading advertisements that may lead people to think the collections are for charity.
Nicholas Rees from the West Midlands made door-to-door collections in connection with flyers from Kosta Ltd. The flyers were posted through letterboxes appealing for donations of unwanted clothes and household items, and gave the impression that the items were to be collected and used for charitable purposes.
The advertiser claimed to support 'H.K.L. Charity' in Lithuania and included statements in its flyers such as: 'Please help those who really need your support!', and 'We will be grateful if you could kindly donate...' The style of the flyers was similar to that used by genuine charities carrying out door-to-door charity collections.
The OFT found the advertisements to be misleading in view of evidence suggesting that the collections were made for commercial purposes with the donated items being sold for profit. Kosta Ltd is not registered with the Charity Commission and is a dissolved company. H.K.L. Charity is not recognised in Lithuania.
Mr Rees was prosecuted by Birmingham City Council in June 2004 for unlicensed door-to-door collecting. He gave undertakings to the OFT under the Control of Misleading Advertisements Regulations after evidence from this case was passed to the OFT. Mr Rees has undertaken that he will not be involved again with the publication or dissemination of advertisements which falsely give the impression that the advertiser is:
- a charity
- requesting and collecting donations on behalf of a charity
- requesting and collecting donations for charitable, benevolent or altruistic purposes
- a bona fide registered limited company.
If Mr Rees breaches the undertakings the OFT could seek an injunction against him in the High Court. Failure to obey an injunction could result in proceedings for contempt of court.
The OFT is aware of a number of other similarly deceptive flyers promoting commercial collection schemes. The people behind these schemes are often difficult to track down as the flyers give no genuine contact details and the details registered with Companies House are false. The schemes can be shut down and new ones started up very quickly. The OFT is continuing to work with the Charity Commission, police, local trading standards services and the Advertising Standards Authority to stop them.
. . .
5. Nicholas Rees was formerly a company secretary of Green Valley Clothing Ltd, a company which collected used clothing for export to Lithuania. He resigned on 30 November 2002. . . .
7. . . . The OFT can take action against anyone appearing to be concerned or likely to be concerned with the publication of a misleading advertisement. It can apply to the courts for an injunction ordering such persons to comply with the law in future. It can also accept undertakings from those involved in lieu of action."