Blackmail - what do you do?

Blackmail - what do you do?

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JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
Interesting one here.

I won't go into too many specifics of this particular instance, but am very interested to hear the opinions of other business owners and legal bods.

My company works with mainly the public sector. We come and do a service on an agreed date, and send out our terms and pricing schedule in clear plain english, writing, and only book them once we have evidence that those terms have been received and we also make specific written reference asking them to thoroughly read them. It's no small print, simply a four page overview of the service, with explanations of what default payment and cancellations terms are etc.

However, the truism of 'leading a horse to water...' is always there, and once in a while we end up with a problem, as the client has not read the simple requirements properly, or clearly not at all. They might not get the full benefit, but we've of course still done the work, so they still have to pay, as per the terms.

Usually, before it gets to dispute, we can just outline where the thing that they apparently '...weren't aware of' was in the first paragraph of our terms, and in duplicate in other places, and they realise that it has been their fault.

However, a handful of times (out of 1500 clients and 15 years I might add) we've got this:

"I'm not paying you. And if you pursue this matter, I'm going to use my position in the body to tell X other bodies how bad your company is and never to use you."


To be clear, I'm talking about situations where the client is indisputably at fault, and there's no issue with our work. And to cover this up, they are effectively saying that unless we make a loss, and they receive the service for free, we are going to be defamed.

My reading of the Theft Act is this is blackmail. It's an unwarranted demand, which has gain for them, loss for us, and is backed up with menaces.

However, in the real world though, what can a company do when faced with such a situation?

In the first instance I always try to bend over backwards for clients, and of course avoid litigation like the plague. But in theory, should push come to shove, is this blackmail? And what can be done?

JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
I should add that previously when such a thing has been put to us, it's been on the phone and my tact has been to let them rant on the before repeating what they have implied back and they realise how unreasonable they've been and how unacceptable the demand is.

On this occasion, for the first time, it's in an email.


JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
Soov535 said:
JustinP1 said:
I should add that previously when such a thing has been put to us, it's been on the phone and my tact has been to let them rant on the before repeating what they have implied back and they realise how unreasonable they've been and how unacceptable the demand is.

On this occasion, for the first time, it's in an email.
Head of Compliance. The person who has done this is a tit.
In this particular case, it's the head of an educational establishment. Cheers though. It's as unacceptable as I thought.

So, I guess I take it up with whoever their superior is?

The other part of my query is more hypothetical. Is this blackmail, and thus a criminal offence? And would/do the police do anything about it?

Also, is this something that the person would have personal liability for, or is the fact that they've made the threat as part of their position in the organisation change the liability?

Edited by JustinP1 on Wednesday 26th November 11:52

JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
98elise said:
JustinP1 said:
I should add that previously when such a thing has been put to us, it's been on the phone and my tact has been to let them rant on the before repeating what they have implied back and they realise how unreasonable they've been and how unacceptable the demand is.

On this occasion, for the first time, it's in an email.
Then possibly reply in a polite way saying that it looks like they are trying to Blackmail you, an perhaps thats not what they ment and could they clarify. If they don't back down then take it further.

Don't forget that it might be something said in haste, and the person could lose their job and possibly their career over it.
Yes.

As it happens, I did reply by email in as polite way as I could, highlighting the threat, and asking what they actually want us to do at this stage, whether it is right that the works be abandoned, at our total cost, and finally, asking exactly what they intend to do if the demands they make are not met, and we do invoice for our work as per the contract.

My hope was, as you have said was that this would be an opportunity for them to come 'back from the brink', and reconsider how morally unacceptable their ultimatum was, and retract it and at least negotiate forwards.

My email of a week ago has not got a reply - hence my post on here today. I find it useful to get perspective from the PH masses!

JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
ging84 said:
Sounds like blackmail but it needs to be put into context, if for example it was a small bill, then realistically it's not blackmail or at least not enough to make worth reporting as a crime, it's just someone ranting particularly if the threat is doesn't have much substance to it. If on the other hand it's a substantial bill, and the threat to your reputation is quite a real one then it might be something worth pursuing as a crime.
The bill is £800.

We're a small company, so it's a reasonable amount, as we don't go around doing work, racking up expenses and making bespoke goods for free.

In terms of the that itself, my gut feeling is that the person is unlikely to follow through in any case, but, the risk is there and I need to look out for my own and employee's livelihoods so don't want to underestimate things.

In terms of the threat, it was reasonably explicit, mentioning that they have a number of contacts, and mentioning that their position in a national organisation gives them the opportunity to tell a large number of bodies nationally not to use us.

I should add there is no reason put forward for something we've done wrong and thus what these bodies would be told...

My motivation here is not to get the person in trouble but to simply move things forward so we can get paid with a minimum of fuss. What would help is if I can present the facts, along with the confirmation that blackmail has been committed and ask the superior to make a sensible decision.

JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
Sump said:
Sounds like you are one of those companies that does something most people wouldn't expect but hide behind 4 pages of T&Cs, most people pay up and move on.

What's more so is most people are happy to discuss the issue and your work together to fix the issue, that's what customer service is but from his email, it looks like you have done something extremely unreasonable and you hide behind your 4 pages to justify it.

That's what it comes across to me as.

Then again, you do get some right nutter customers.
You'd be forgiven for thinking that, but after having studying law as part of my business degree at uni is a great bugbear of mine to supply pages of 'small print' T&Cs. So we don't. There's no waffle, no legal terms at all. Nothing an 11 year old could not read and correctly comprehend back to you.

When I refer to our 'terms', it is 4 pages of 11 point text set out in easy to read paragraphs with headings like:

"What does the service include?" "How much does it cost?" and 2-4 sentences below. I go with the ethos that the more simple things can be set out, and important terms can be set out as plain english, they are more likely to be complied with so you don't have to enforce them as much! We are talking about 100 words a page time four - something that can be digested in 5 minutes.

The only way that the person could have got everything so wrong is if they didn't read the short email we sent explaining how we work, and that concept can be explained in a sentence and this is the *first sentence* of our terms. In any case, when we take bookings, we confirm them in writing, and directly request that the client reads in terms again to ensure their project runs smoothly.

The issue here is not a trivial breach of small print, it is that they simply couldn't have read even the first lines of anything we sent. Or, they messed up and want someone to blame.


Edited by JustinP1 on Wednesday 26th November 16:50

JustinP1

Original Poster:

13,330 posts

230 months

Wednesday 26th November 2014
quotequote all
silentbrown said:
Silly question, probably : Have they complained about your service, or your T's & C's in any way? Have they given *any* reason why they won't pay?

And - to add a different view - I think they're free to *truthfully* describe their experience with your company to anyone they like, unless you have a 'Blackpool hotel' clause in your terms somewhere.

Edited by silentbrown on Wednesday 26th November 23:07
They've said they didn't receive the terms. So, I showed them where they did, by email, and how they replied back to it with our email and the terms in question actually sent back as our email. Not once, but three separate instances of explaining the fact in question.

They've gone through the terms with a fine tooth comb and picked out the fact that we state we have 15 year experience in working with the sector, and thus they critique that we should have helped them more. So, I've showed them where exactly in an email we've explained what we offer in a few sentences they didn't read, how this is repeated in all of the three documents we provided, and how we asked them to read them thoroughly, whilst being on hand for free, unlimited telephone and email support.

They've picked out 'they haven't signed anything'. I haven't even risen to this one...! We've supplied written terms, and there's written acceptance, and of course we've done the work. On their request, we'd even supplied work ahead of schedule they had no problem with.


This really is a case of "I'm fked... how do I get out of this...' If they've spent 10% of the time they spent reading the instructions in the last week in the hope of finding a loophole actually finding out the fundamentals of what they were committing to do before the project, it would have been a success. As I've mentioned, we write really simple instructions and terms and work with 100 plus clients a year. I can't remember someone getting things this wrong, and it could only have occurred through being grossly negligent and simply not reading the first things we've written.

That's the truth of their experience. However, I'm sure that is not what they are implying would be the content of their public critique!

Don't get me wrong, I have a 100% client satisfaction policy. For example, just today a client found a mistake in copy they sent to us, after we'd printed and delivered the bespoke items. We remade it and delivered it in 48 hours without charge to them.

We bend over backwards. However, on this occasion, the client has no genuine issue - even the weak and false ones they brought up wasn't on receipt of goods - it was only when the discussion turned to payment.

I've asked them for how they'd ideally like to proceed - and not even that is deemed worthy of a response. They are intentionally leaving the situation with us completing the work, and us being forced to 'break the ice' and ask for payment and thus incur their wrath of defamation.

My line is drawn on the issue of extortion on the threat of defamation - hence my post.


Edited by JustinP1 on Wednesday 26th November 23:46


Edited by JustinP1 on Wednesday 26th November 23:48

JustinP1

Original Poster:

13,330 posts

230 months

Thursday 27th November 2014
quotequote all
Cyberprog said:
Breadvan72 said:
The problem with that is that you are supposed to tell people that they are being recorded, as otherwise you can get into a legal pinch.
Chuck it onto the system as they call in, simple enough to do, everyone hears it these days when you deal with big companies...

And even if you can't use it legally, you can play it back for their head of compliance/governers...
Just to follow up, we do record calls as a matter of course.

Whilst we confirm anything contractual in writing, we do discuss aspects of what we offer on the telephone pre-contract, and sometimes the acceptance takes place orally after the prior supply of written terms.

I took legal advice about this after a few incidents. We are only recording to evidence contract in the very few occasions it is brought into doubt. Thus we are entitled to record calls, without the 'qualify and training purposes' warning.

We've had clients deny point blank things they've said previously. Also, if a client says "on the phone you told me X", if X was indeed said then whether it's wrong or not we can stand by it. So for the once a year or so it's needed it vastly outweighs the cost.


Edited by JustinP1 on Thursday 27th November 00:20

JustinP1

Original Poster:

13,330 posts

230 months

Thursday 27th November 2014
quotequote all
I must admit that up until last year recording calls was not something we did, not only due to the logistics, but due to the legal issues. I must also admit the advice was against my gut feeling due to always hearing 'your call may be monitored for quality and training purposes'.

However, I was also directed to Ofcom, and in reading the guidance the reason for the disclaimer is clear as 'training purposes' is not a legal reason to monitor a telephone call without consent. Then, it all made more sense. However, there are some specific reasons why you can, including evidence of transactions.

I should add that the system in place is that we have IP phones. The telecoms provider has a record of the times and telephone numbers in and out. We can download an audio file of the conversation. The only reason we would do so is for something which literally happens only once or twice a year, where a client wants to rely upon upon something in a telephone call that they deem to be contractual. In that situation, with their consent, we obtain the audio file.

I've just checked, in the hope I am not going mad, and our policy above as being in line with RIP is the same as a number of other companies, including Imperial College for example:

http://www3.imperial.ac.uk/secretariat/collegegove...

JustinP1

Original Poster:

13,330 posts

230 months

Thursday 27th November 2014
quotequote all
Vaud said:
don4l said:
Have you done work without a signed purchase order?

This would be entirely unacceptable, in my view.
Lots of work happens and is approved to proceed without a PO with no legal issues occurring.
Yes. Also due to the nature of the service, it is not possible to define a set figure for a purchase order until work has started, so it would be impossible.

To give you an idea of the lengths we go to to ensure that the client can get the most from the project, no member of staff is allowed to book in a project without confirmation that our terms with a direct request for the client to read them is confirmed received not once, but twice. Once pre-contract, and once again within 24 hours of acceptance. No booking is allowed to take place whilst there is an open query which has not been answered to the client's satisfaction.

Bookings are only taken and confirmed with the unequivocal written request, and are confirmed received in writing.

To give you an idea of the standard of 'business' in the sector, before the widespread use of email, we had a written contract which was literally six sentences long, in 12 point Times text, that we would require signed by the head of the establishment. However, on more than one occasion, the reason for failure of the project was put forward as we should have 'understood' that the signatory would be too busy to read the contract they signed. I kid you not... smile

Edited by JustinP1 on Thursday 27th November 16:02

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Mr Taxpayer said:
cymtriks said:
evil
Tell him that unless he pays double you'll spread that email far and wide.
Local papers love this sort of story...
Just to clarify here, and whilst the tongue in cheek options are entertaining, for obvious reasons I want to stay entirely above board here, and treat this in a formal way.

My issue is at this stage is when I contact the powers that be, as I will have to, what am I in a position to state about defamation, and blackmail?

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Breadvan72 said:
You can say that you have received what is in effect a demand for a financial advantage with menaces, and that bad faith negative comments about you are threatened. Bear I mind that defamation requires proof of financial harm when the claimant is a business.
Cheers BV.

I'm not going to go in all guns blazing, and to be frank in only going to bring it up to assist moving forward sensibly.

It is implied very strongly in the threat that financial harm will come, otherwise there would be no motivation for the threat. I appreciate what you say about the proof however.

It does seem that no action could be taken until after the act and effect. Is there anything I can do to draw a line in the sand before that point?

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
silentbrown said:
Here's some non-sausage related points: From a business perspective, £800 is annoying, but probably not the end of the world - either for you, or the customer. Don't let it get to you too badly.

Also, everybody -sometimes- bangs off an angry email without thinking it through. I've written a few total snorters and left them sitting in my 'drafts' box overnight - (inevitably I delete them and pick up the phone instead the following day, which usually has a much better outcome).

Maybe your customer has a hidden problem somewhere that he can't/won't tell you about. The situation to a Wedding Photographer struggling to get paid if the "happy couple" don't stay together beyond the honeymoon. Your work has been fine, but the "project" simply didn't go according to plan.

Personally I'd want the whole problem to go away, -regardless of the ill-advised threats- and would try carrot and stick together: Get in touch, offer payment terms/discount or similar. Make it clear that if you can't settle this amicably you WILL go legal to collect full payment. Don't bring up the topic of his threats unless they're repeated, at which point I'd remind him that you have them in writing and are "taking legal advice" on the issue. (well, you asked here, didn't you...)
Cheers - you've seen to the crux of the problem.

You are correct on all counts. There is a 'hidden problem', which is pretty much the elephant in the room.

Without being specific, we advise, and not only advise, make it a term that the whole of the organisation is involved in the project. That itself makes it a success, and more than covers the cost of our bill. We also make it a term that the financial side of the project is handled at their end in a particular way which again also ensures that as in organisation they actually profit from using our service.

The problem is that they've only involved 10% of the organisation - against our terms, and not even started on the financial side of the project - again against our terms. Both of these factors were explained in writing on three separate occasions. Out of 15 years and 1500 clients if this is not the most negligent client, they are in the top three.

So, the project is fundamentally flawed due to their piss-poor planning, and as this stage will never be a success. Of course, due to this, they'd very much like at this stage if they don't have to pay us! Indeed, if this is escalated, the buck will stop at the organiser as to why the project was so negligently managed and a financial cost. Hence the demand from the organiser to make things 'go away'.

The issue is that after putting forward the blackmail demand, I have now emailed twice, a week apart each time to make inroads to negotiation, even asking what we can do at this stage to assist their situation.

The person has not replied - hence it is pretty clear they are playing a game of 'chicken' with their blackmail demand. We are left with no other option than to escalate, but, if we do, the defamation consequences have been made explicit to us.


You are right. I also type emails in the heat of the moment, but as a matter of course, sleep on things and consider things properly. As such I thought I'd use the collective reasoning of PH to assist - so cheers!

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Breadvan72 said:
Justin, did you see what I said about disclosure of phone recording? Your lawyers gave you a bum steer.
Yes - I did, and as always, thanks for your learned input!

I must be honest I'm puzzled I did investigate thoroughly from what you've said as I was shocked as you'd imagine.

The same advice as was offered to me is actually given by other solicitors on their websites:

http://www.pearne.co.uk/?p=1658

"Regulation of Investigatory Powers Act 2000...
Interception is allowed in either of these situations:
The business has reasonable grounds for believing that the customer has consented to the interception; or
The interception is authorised by the Lawful Business Regulations.

Telecommunications (Lawful Business Practice) (Interception of Communications) Regulations 2000
The Lawful Business Regulations provide that it is lawful to monitor and record calls *without consent* in the following circumstances:
To establish the existence of facts relevant to the business (for example, keeping a record of instructions given by telephone, where it is necessary or desirable to know what has been said during a conversation);

And also here: http://www.gannons.co.uk/blog/recording-and-monito...

"Recording Calls with Customers

Regulation of Investigatory Powers Act 2000

The Regulation of Investigatory Powers Act 2000 regulates the interception of phone calls that are sent by a private or public telephone. The key word here is “interception”; an interception takes place where the contents of the conversation are made available to a third party without it exiting the receiver. It therefore follows that holding a recording device (such as a microphone) to the receiver is not considered to be an interception.

Telephone calls from customers to call centres are usually recorded and are therefore interceptions. These are permitted under this legislation provided that: (i) the customer consents to the recording (usually after being notified by a recorded message) and the business has reasonable grounds for believing that the customer has consented (i.e. the customer has communicated its acceptance or implied acceptance by continuing with the call; and (ii) in the absence of consent, it is authorised by the Lawful Business Regulations (see below) .

Telecommunications (Lawful Business Practice) (Interception of Communications) Regulations 2000 (Lawful Business Regulations)

The monitoring and recording of calls under this regulation is only permitted, without consent, if it is solely for the purpose of monitoring or recording a communication which is “relevant to the business” and efforts have been made to notify every user.

Recording conversations:

Establishing facts relevant to the business i.e. where it is necessary to keep a record of the conversation;"




I've emboldened the important bits for anyone following and skimming...!

The specific situation I got advice upon was if I needed a specific disclaimer. In our case, calls are logged at the telecomms company. In the case of a genuine dispute, and with the client's consent we can get that audio file for us, and if necessary the client to listen to. In any case it is never made available to a third party.

I guess the act of 'interception' is actually requesting the telecoms company to create the file so we can listen to it, and we do that with consent.

According to both of these solicitors however, for the purposes I've mentioned, they suggest that prior consent would not be necessary anyway?


Edited by JustinP1 on Friday 28th November 12:30


Edited by JustinP1 on Friday 28th November 12:31

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Breadvan72 said:
You have missed out the relevant bit. You have to take reasonable steps to inform the punter of the recording. Its plainly set out in the Regs.
I've scanned down it, could you be more specific on the exact section/part/chapter?

However, this would mean that both of those solicitors have missed that point too.

Can you see why that runs against the interpretation of those solicitors?

For example here:

"(i) the customer consents to the recording (usually after being notified by a recorded message) and the business has reasonable grounds for believing that the customer has consented (i.e. the customer has communicated its acceptance or implied acceptance by continuing with the call; and (ii) in the absence of consent, it is authorised by the Lawful Business Regulations (see below)"


If you get consent, for example a recorded message that the call is recorded, the customer continues his call afterwards, he has consented.

The information above from those two sources refers to where there is no consent attained, and gives examples for situation where no consent would be necessary.

Edited by JustinP1 on Friday 28th November 14:35

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Breadvan72 said:
Reg 3(1)(c). Reasonable efforts to inform.

Interception includes recording a call.
I think what the solicitors are getting at is the LBP regs came afterwards and expanded on the restrictive nature of RIPA.

Here's another example, this is pretty unambiguous:

Clarks Legal LLP said:
ADVISING CALLERS THAT CALLS ARE BEING MONITORED/RECORDED.

Businesses do not have to tell callers that they are monitoring/recording telephone calls into the business if they are doing so for one of the reasons set out in the LBP Regulations (see above). You do have to advise employees that their calls are being monitored. If you are relying on other reasons you need to notify callers.

If you wanted to record/monitor calls for any other reason (such as training purposes or market research) and you want the opportunity to use the recorded calls in training sessions in front of third parties you need to inform the caller that their call is being monitored/recorded so that they have the opportunity to consent by continuing with the call or hanging up.
That's from here: http://www.clarkslegal.com/PrintArticle/341

Please don't get me wrong, you know for me 'every day is a school day'. Just before I lambast a professional for giving me duff advice, I obviously need to be sure of myself.

From that quote there, if businesses did need to take 'reasonable efforts to inform', then I don't know why these solicitors don't say exactly that, and indeed they say 'Businesses do not have to tell callers..."

JustinP1

Original Poster:

13,330 posts

230 months

Friday 28th November 2014
quotequote all
Hol said:
I cannot see it metioned, but...

The delivered £800 of printed articles - can they still actually be used by the client?

Or, have they messed up and the money was wasted?

Both. smile

Goods are 95% ready. Only thing waiting on is a small amount of copy from the client to finish.

Client is not sending said copy, as they don't want the goods delivered as they will not sell enough to cover the cost. That's due to them a) Messing up, and b) Messing around for so long, and not supplying said copy despite numerous times of asking.

JustinP1

Original Poster:

13,330 posts

230 months

Friday 12th December 2014
quotequote all
An update chaps - and an interesting one!

First off, thanks for the input so far, I did take this perspective on board. I wrote a letter to the head of the organisation, and sat on it with the knowledge as pointed out that if the organisation acted properly, it would be damaging for the persons career.

Instead I followed up my reply to the threat asking for it to be clarified seven days later with another email, requesting what was needed to finish the works. Both were ignored, so their threat should we rock the boat was very much relied upon.

So a crafted a third email, carefully, with the knowledge that it would be repeated.

It said I had taken advice, and I copied almost verbatim the section of the Theft Act regarding blackmail, and referred to the gain they would make, the loss we would make, how it was demanded, and repeated their explicit threat of the body that would be told not to work with us if we 'pursued' the matter.

I was very careful to be factual, and put it to them, on the third time of asking whether in light of the above whether they would like to retract the threat. Alternatively, upon the given deadline I would be left with no option than to contact the head of the organisation, to confirm that defamation would not take place, and the demand expressed was not shared by the organisation. I don't even mention being paid for our work, or any demand at all, simply a request to retract the threat.

Clearly, that made the person jump, as I've received two letters, one from the person making the demand, and one from the head. Neither are longer than the letter in Arkell v Pressdram, and similar content! The person making the demand tells me that I cannot contact them, and I must wait from their union legal advisor.

The head of the organisation states that I have been bullying and threatening, that they will not contact me in future and that I must speak to the council legal dept and that they will ensure that Trading Standards will thoroughly investigate us! smile

I should point out that I have no fear of the latter, however, it is the case that not only has their threat not even been denied, it is now positively reinforced and expanded on...


In hindsight, I should have gone straight to the head. Silly me for thinking of the blackmailer's career. What I think has happened is the head has been provided with some very selective information to garner support. Or, he is just as corrupt as the other person.

Open to the floor chaps!

And if I need to lawyer up on this when I get the reply, does anyone have any recommendations for this field?


Edited by JustinP1 on Friday 12th December 21:47