Dominic Regan returns to the consequences of the referral fee chop
My recent article about this topic provoked more interest than anything I have ever written. I return to the topic for much has happened since the government announced that it was going to ban the payment of referral fees.
Meanwhile, in a fiery talk delivered last month, Jack Straw stated that the claims management companies which thrive on the lucrative income generated by the commoditisation of claims would not be allowed to circumvent the law.
Self-referral
One possibility I anticipated in my earlier article has seemingly already happened. I understand that some claims companies have decided to buy into law firms and so maintain their income by referring the cases acquired to itself.
There has also been a remarkable change of nomenclature, with several bodies that were receiving referral fees now saying that it is a marketing or advertising fee instead. Those companies, such as Injury Lawyers 4U, which advertises
