In a damning story by the ABC, national law firm Slater and Gordon was accused of claim farming, or paying for client referrals.
The story said that the practice is specifically banned in some states of Australia, while others discourage the practice.
“The faltering law firm Slater and Gordon is hard-selling its personal injury services via telemarketing, despite its own senior lawyers warning almost a year ago the practice was unethical and possibly illegal,” the ABC article stated.
“Paying for client referrals is broadly permitted under the Australian Solicitors Conduct rules, as long as it is disclosed and doesn't create a conflict of interest for the lawyer.”
It cited “secret internal documents” as evidence for the allegations.
However, speaking to My Business’ sister publication Lawyers Weekly, Slater and Gordon denied it had breached legal or ethical standards.
“Our board and management uphold the highest ethical standards in meeting the firm’s legal obligations. We are proactive in ensuring that any marketing we undertake is compliant with applicable laws and confident that it meets the highest ethical standards,” a spokesperson for the firm said.
“Slater and Gordon has acted and continues to act in accordance with all its legal and ethical obligations regarding its marketing activities. We confirm that neither we nor anyone on our behalf is engaged in ‘claims farming’.”
The spokesperson declined to comment in more detail, stating: “We are not prepared to disclose or discuss the commercial relationships we have with other parties and provide confidential and commercially sensitive information.”
While the legal profession faces particularly stringent rules around marketing practices, businesses of all shapes and size are bound by both legal rules and societal expectations around what is appropriate when it comes to marketing activities.
A Queensland burger chain last year had its printed flyers dumped by Australia Post after the national postal service expressed “ethical concerns”.
Meanwhile the Do Not Call Register was established in 2006 in a bid to reduce the number of complaints around telemarketing, with the Australian Communications and Media Authority (ACMA) updating the rules governing telemarketing and research calls in 2017.