Thousands of people are being ripped off by some will-writing and claims management companies because of a lack of regulation, the Legal Ombudsman warns.
The Chief Legal Ombudsman Adam Sampson called on the Government to take action to stop consumers being left vulnerable and confused by unregulated companies.
The Law Society and Which? also called for more protection for consumers in response to the report, the first to Parliament from the Legal Ombudsman since the office was set up in 2010 to help people resolve complaints about lawyers.
Mr Sampson said: “One service which crops up a lot is will-writing. It’s a service carried out often by will-writing firms who aren’t regulated.
“Because of this, customers are left with little means of redress when things go wrong. We’ve seen similar confusion about claims management companies, with lots of consumers believing they’re getting a legal service even though most of the work is carried out by a non-authorised person. Again, we can’t help.”
Consumers are being caught out by the bundling together of legal and financial services with other products, particularly on the internet, the consumer groups warned.
Des Hudson, chief executive of the Law Society for England and Wales, said: “The gap in regulation which allows unregulated cowboys to operate in areas like will-writing does not just cause unfair competition to solicitors, who provide a regulated, professional service.
“It is also damaging to consumers because the unregulated providers are not insured, do not provide a compensation fund and are not covered by the Legal Ombudsman’s scheme for consumer redress.”
A Ministry of Justice spokeswoman said: “Will-writing is an important issue. We welcome the Legal Services Consumer Panel’s detailed report into the subject and will await the outcome of the Legal Services Board’s ongoing work.”