Member Article

Charities’ fines signal urgent need for change

Financial penalties of between £6,000 and £18,000 issued to eleven high-profile charities this month, signal the need for an urgent review of practices surrounding charity’s use of data, warns charity law expert Mark Lewis.

“Charities including Oxfam, Cancer Research UK, The Royal British Legion and Battersea Dogs’ and Cats’ Home, have been issued monetary penalties for contravening data protection laws,” explains Mark Lewis, a partner at law firm Lodders.

“This represents an important, significant step by the Information Commissioner’s Office (ICO) to review and regulate data protection practices across the not for profit sector,” he says.

“In light of the incoming General Data Protection Regulation, set to be implemented in May 2018, charities and other commercial organisations must review and adapt their practices to comply with the new requirements.”

The ICO ordered that the eleven charities pay the fines following an investigation into alleged pressure on donors to make follow-up donations, which formed part of a broader investigation into the way in which charities handle personal information.

“One method that was used by seven of these charities was the principle of profiling their donors based on their wealth,” explains Mark.

“To do this, they hire the services of independent companies to scrutinise an individual’s lifestyle – including their income, assets and even social interests – with the aim of pinpointing those they believe to be the wealthiest. They can also determine which individuals are most likely to leave a legacy in their wills, giving them a selection of people to target in their marketing campaigns.

“Clearly, this is a serious contravention of the Data Protection Act as not only do the donors not consent to this practice, they remain oblivious to the fact that it occurs.”

The investigation also revealed several other offences including the use of multiple sources to collect and ‘piece together’ personal information, as well as sharing this data with other charities without seeking individuals’ permission beforehand.

“Since the ICO’s announcement, a number of the charities have responded in defence of their data practices and assured donors and supporters that their data is handled with great care, something which has been publicly called for by Lord Grade, chair of the Fundraising Regulator board,” says Mark.

“At a time where the protection of personal data is becoming increasingly scrutinised, it is vital that charities can be clear on the regulations that are in place and are able to fully comply with them. Regulators are working alongside charitable organisations to improve how personal data is used across the sector and as established by these fines and the reviews which are taking place they are willing to take appropriate action to ensure the protection of donors’ and supporters’ information.”

Mark Lewis, Partner and head of Lodders’ specialist Charity Law team, is one of only three specialist charity lawyers in the Midlands named as an elite ‘leading lawyer’ by the 2017 edition of The Legal 500, and has a national ranking for the charity work which he does in the Chambers UK 2017 edition. He was recently awarded a Special Commendation of his charity law work in the Coventry & Warwickshire First Pro 2017 Awards.

Lodders is a premier law firm in Warwickshire, Cheltenham, the North Cotswolds, and Gloucestershire. Established for over 230 years, Lodders in particular works with private individuals, business owners, family businesses, landowners, rural communities, real estate and property owners, developers and investors.

The firm has 25 partners, a portfolio of sector and market specific legal teams, over 130 fee earners and support staff across its office network, and has recorded year-on-year growth in recent years. For more information, visit: www.lodders.co.uk

This was posted in Bdaily's Members' News section by Lodders Solicitors LLP .