The data protection watchdog is to contact more than 1,000 firms that buy and sell people’s personal details to ensure they are acting lawfully.

The Information Commissioner’s Office (ICO) said it will this week write letters to the firms, which are all believed to play some role in the compiling and trading of people’s names and numbers used by cold callers.

The firms will be required to set out how they comply with the law, including what data they share, how they get people’s consent to share their data, as well as a list of all the companies they have worked with in the last six months.

If companies do not respond to the letter, the ICO said it would take action to require the information be provided. The sector generates 180,000 complaints a year from people angered by nuisance calls.

Information commissioner Christopher Graham said these complaints helped the ICO identify who the “truly bad actors” are. “This enables us to execute search warrants, to drag people before the courts and to issue fines,” he added.

The ICO will issue a further three fines to firms this week totalling £250,000, meaning it will have issued £1 million worth of penalties in this sector over the past four months alone.

However, Mr Graham said: “But there is a danger that where we remove one of this Hydra’s head, two grow back in its place. By targeting the illegitimate aspects of the list-broking business that fuels this industry, we have the chance to truly strike down this monster.”

Which? executive director Richard Lloyd called on the watchdog to hand out tougher penalties to the executives of firms that break the rules. “Millions of people are still being plagued with nuisance calls, so it’s good the ICO is continuing to crack down on firms that are flouting the rules,” he said.

“We now need to see much tougher penalties for senior executives of companies making unlawful calls, including board directors being held personally accountable.”

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