• UOKiK is investigating insurance complaint bureaus that help their clients pursue claims under contracts for saving insurance policies, mortgages and GetBack corporate bonds.
• President of the Office has already passed his first decisions on these matters, there are also three proceedings pending.
• UOKiK is investigating whether rules for calculation of fees are clear.

The Office has been inspecting offers of insurance complaint bureaus since the second half of 2017. At that time, advertisements came up to encourage people who had insurance capital policies to apply for a refund of liquidation fees. Such offers were also addressed to consumers who have taken out mortgage loans denominated in or indexed to a foreign currency and eventually to those who bought GetBack corporate bonds.

As a result, UOKiK levelled charges against six entities, including four insurance complaint bureaus, relating to the use of abusive clauses and practices that violate collective interests of consumers. There are proceedings pending against the following companies: Arbiter SA from Wrocław, Kancelaria Prawna Semper Invicta Sp. z o.o. Sp. k. from Wrocław (formerly Kancelaria Invictus Sp. z o.o.) and Votum SA from Wrocław. The Office has already passed its first decisions on: DM Group Sp. z o.o. from Rzeszów, Kancelaria Virtus Sp. z o.o. from Kraków, Omikron Sp. z o.o. from Wrocław (formerly Optima Legal Consulting Sp. z o.o.).

Judgement of the CJEU, case No C-260/18 Kamil Dziubak and Justyna Dziubak, will probably make the number of entities helping consumers in court cases against banks increase. I hope that the support provided by insurance complaint bureaus and attorneys-at-law will be reliable and professional. We cannot question the amount of fees as the main benefit of the parties, but we analyse whether provisions on such fees are unambiguous and whether they ensure the balance between the parties. The point is that consumers should know for what and how much they pay, says Marek Niechciał, President of the Office of Competition and Consumer Protection. I encourage consumers to analyse the amount of fees and negotiate the terms of contracts such as fees for winning a case, or deadlines for payment of fees for legal representation. Consumers should ask for a statement of costs, as it may turn out that they will be charged for commuting costs of their plenipotentiary to court, adds Marek Niechciał. Any reservations about the involvement and/or services provided by legal representatives should be made to regional bar associations of attorneys-at-law.

UOKiK has reservations about the following issues:

Commission on winning a case (Semper Invicta). UOKiK does not question the amount of the fee collected, but the lack of clear rules for its calculation. In addition, for example, in the case of one version of the contract, the fee depends not on the amount obtained by consumer, but on the amount demanded by a bank. For example, if a bank requests PLN 100,000 and the court will award such a bank as much as PLN 90,000, while a customer retains only PLN 10,000, the commission will still be charged on the former amount. According to UOKiK, it should be based on the amount obtained by the bureau for its client. President of the Office also called on Semper Invicta to voluntarily amend the provisions for charging success fee as a percentage of the amount of loan received. According to the Office, if a case is won, it means that the outstanding capital will decrease. If this is the result of actions taken by Semper Invicta, the success fee should be based on this capital amount. It will be smaller than a loan received.

No opportunity to choose a plenipotentiary (Arbiter, Virtus, Votum, Semper Invicta). The Office has doubts about provisions according to which law these insurance complaint bureaus individually choose and even impose plenipotentiaries to conduct cases. According to UOKiK, it is their clients who should have a casting vote.

Consumers  fined for terminating their contracts (Arbiter, Virtus, Semper Invicta). In some cases, fines are imposed only on clients, but if the company gives up the case, it bears no financial consequences. Moreover, the amount of the fine may force consumers to continue the contract nonetheless, e.g. the company Arbiter reserves the right to keep half of the commission for terminating the contract, while Virtus demands 10 or 15% compensation. In one case (Semper Invicta), consumers must pay a high fine (up to 10% of the amount of the loan received) when they reach a settlement on their own or entrust their cases to another entity. According to UOKiK, in such a situation consumers are entitled to pursue compensation and prove to court that they actually suffered a loss. Charging the costs of legal representation as a fine, regardless of the court case stage, is also doubtful. Such costs can be charged only if a case is won and not if the contract is terminated while the case is still in progress.

Consumers not allowed to talk and negotiate with banks or insurers on their own (Arbiter, Semper Invicta). Such a provision may violate good manners. Consumers cannot be cut off from their cases and should be able to talk to financial institutions on their own.

Legal action for payment will be brought when the company and consumers agree (Votum). It is not known, however, why Votum may refuse to bring an action. In addition, consumers pay fee for services in advance, even though they may not be provided. The contract between consumers and Votum does not specify the rules for fee calculation in such situations. This provision may violate good manners because it favours stronger position of the company.

No obligation to provide statements of expenses (Semper Invicta). The company must provide its customers with a detailed statement of expenses. The lack thereof means that consumers do not know for what and how much they paid and whether fees are justified.

Fine for breach of confidentiality (Semper Invicta). Consumers are not allowed – without the company’s prior consent – to disclose their contracts to third parties or a fine will be imposed on them. In other words, they will suffer consequences if they disclose such a contract to family members, friends or acquaintances. Furthermore, such clauses may discourage those who vindicate their rights from consulting the contract with a lawyer or a consumer ombudsman.

Money awarded by court is paid to the company’s account right away but payment to consumers is made even 4 months later (Semper Invicta). This insurance complaint bureau uses clauses according to which money awarded by court if  bank loan agreement is considered invalid goes to its account immediately while transfer is made to consumer’s account within 30 days or “no later than by the 20th day of the month following two months”, i.e. even almost 4 months after the awarded amount is credited to the bureau’s account. This means that Semper Invicta has access to its consumers’ money for too long while it should pay it out immediately.

Misleading information (DM Group, Omikron). These entities posted information in their social media and on their websites suggesting that they pursue claims on behalf of their clients, while strictly speaking they only collect offers and act as an agent in establishing cooperation. E.g. DM Group claims that it has already recovered over PLN 10 million under unit-linked insurance contracts on behalf of 1.3 thousand people, is 100% effective and the whole procedure takes less than 27 days. Omikron, on the other hand, reported that it analyses loan agreements and annuls them, while in reality it collects offers and sends them to law firms and/or insurance complaint bureaus.

Marking announcements and advertisements

Observations made by UOKiK show that newspapers publish articles that may look like a neutral text, but in fact they could be an advertisement of a law firm or insurance complaint bureau. This is why President of UOKiK sent letters to several entities in which he calls them on to appropriately mark advertisements and announcements. It is not enough to say that some material was created in cooperation with the company XY or that entrepreneur so-and-so is a publishing partner to some issue. It must be clear that announcements and advertisements do not constitute editorial content. I call upon publishers to develop standards of properly marking promotional materials, adds Marek Niechciał, President of UOKiK.

Consequences

President of UOKiK has already passed his first decisions: he imposed a fine totalling PLN 47,716 on DM Group, PLN 11,736 on Omikron for misleading, and PLN 28,915 on Virtus for the use of abusive clauses. The amount of fines is set based on the company’s annual turnover. Three proceedings (regarding the recognition of provisions as abusive) are still not resolved. They were brought against: Arbiter SA from Wrocław, Kancelaria Prawna Semper Invicta Sp. z o.o. Sp. k. from Wrocław (formerly Kancelaria Invictus Sp. z o.o.), and Votum SA from Wrocław.

If announcements and advertisements addressed to consumers are not clearly marked that they do not constitute editorial content, President of UOKiK will consider taking further steps, including initiation of proceedings. The maximum fine in such cases is 10% of company’s annual turnover.

Advice for consumers

• Carefully read the contract before you sign it. Do not be too hasty in making
  a decision. Take your time, remember you will be paying your loan back for several decades.
• Do not be afraid to ask questions if something is unclear to you: the rules for fee calculation must be absolutely clear to you. If you do not understand certain provisions, including those on fees, ask an employee from an insurance complaint bureau to explain and clarify them on the copy of the contract. And if such an explanation still raises your doubts, ask someone else, e.g. a lawyer.
• Ask for extra expenses, such as court fees, costs of commuting to compensate legal representatives for travel expenses to and from court, or advance payments for an expert.
• Find out who will pay the costs of legal representation awarded by a court and who will take the risk and bear the costs if your case is lost.
• Negotiate the terms of the contract, such as basic remuneration, success fee, or how much time you will have to pay the costs of representation (e.g. after the conclusion of the contract, after its performance, or in instalments, e.g. after certain stage of proceedings).

Consumer service:

Phone: 801 440 220 or 22 290 89 16 – consumer helpline
E-mail: [SCODE]cG9yYWR5QGRsYWtvbnN1bWVudG93LnBs[ECODE]
Consumer ombudsmen – in your town or district
Financial Ombudsman – www.rf.gov.pl – when a complaint is rejected
Regional Consumer Centres: 22 299 60 90 – Dlakonsumenta.pl

Additional information for the media:

UOKiK Press Office
Pl. Powstańców Warszawy 1, 00-950 Warszawa, Poland
Phone +48 695 902 088, +48 22 55 60 246
E-mail: [SCODE]Yml1cm9wcmFzb3dlQHVva2lrLmdvdi5wbA==[ECODE]
Twitter: @UOKiKgovPL