There’s been a huge development in the care homes consumer protection case. The Competition and Markets Authority (CMA) has initiated court action against Care UK.
We recently blogged about the developments in the care homes consumer protection case where pre-action letters had been sent. Now, they have proceeded with court action against Care UK.
The reason for the court action is because the CMA isn’t satisfied with the response from care UK following the investigations. Although they’ve stopped charging administration fees that the CMA had deemed to be breaking consumer protection laws, they haven’t agreed to refunds. The CMA has taken issue with their stance.
The lead up to the court action against Care UK happened
The court action against Care UK follows the CMA’s belief that Care UK has been breaking important consumer laws having investigated the industry and their business practices.
In short, the CMA had reportedly taken issue with the following behaviour:
- The need for residents to pay substantial administration fees that are non-refundable where no service or product is even provided;
- The descriptions of these charges, and why they are there, being deemed as misleading;
- Residents being informed about the charges too late during the admission process.
The CMA believed that these charges are unfair and are in contravention of consumer protection law. As such, advice and open letters had been issued prior to the recent pre-action legal letters that had been sent.
Why has the CMA now taken court action against Care UK?
Following on from their intervention over the charges, the CMA has taken court action against Care UK because they appear to be refusing to refund residents who have already been charged these fees. Although Care UK has agreed to stop charging them, they appear to be simply unprepared to offer redress for anyone who has already had to pay them.
The CMA has said that Care UK must refund some 1,600 residents who were charged these fees amount in the region of £3,000.00 per person. Because they have not done so, the CMA has now launched court action against Care UK.
We will continue to monitor developments in this court action and the wider care homes consumer protection case.