By Marcus Leach
The director of a premium text message information provider has been disqualified from acting as a company director, managing or in any way controlling a company for five years, following an investigation by the Company Investigations team of The Insolvency Service.
Oisten Jakob Mathiesen, now living in Spain, was the sole director of SMS Digital Future Limited throughout the life of the company.
Between February 2007 and November 2008, the company operated a premium rate auction subscription service. Participants bid for electronic goods through a series of text messages sent to their mobile phones, from mobile phone numbers known as short-codes, and networks provided by a number of service providers.
The investigation by The Insolvency Service found that SMS Digital Future had reversed the premium rate mobile phone charges so that participants paid the rates, causing the company to breach the industry Code of Practice. Some recipients of the text messages had also not opted into SMS Digital Future's text message auctions, yet were sent the text messages and charged at a premium rate by their network operator.
After receiving 185 complaints from the public relating to the operation of SMS Digital Future's auctions the industry regulator, PhonepayPlus conducted investigations into the operation of SMS Digital Future's auctions.
This culminated in three tribunal decisions, which found that SMS Digital Future had knowingly or wilfully sent out misleading, unsolicited promotional text messages in breach of the industry's Code of Practice relating to 'legality'. The tribunal imposed formal reprimands and levied fines totalling £350,000 on SMS Digital Future and the service providers.
Investigations by the Insolvency Service found that Mr Mathiesen's actions had breached the industry's Code of Practice and disqualified him from acting as a company director.
"All businesses must observe the law or they will be punished. The industry Code of Practice was put in place to protect the public from businesses that attempt to use new technologies for their own ends with a careless disregard for the required procedures when marketing text message services to consumers. Mr Mathieson flagrantly and repeatedly breached this Code," Claire Entwistle, Director of Company Investigations (North) of The Insolvency Service, said.
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