A clampdown on rogue ‘no-win, no-fee’ firms has seen hundreds shut down – including one in Huddersfield.

The rip-off firms tempt unsuspecting consumers with the promise of pay-outs for personal injury, mis-sold payment protection insurance (PPI) or unfair bank charges.

Many people targeted by the firms have no chance of a payout but are still stung for up-front fees.

The Ministry of Justice revealed a crackdown by its Claims Management Regulation Unit has seen dozens of Yorkshire firms warned.

It has visited 15 claims management firms in the Huddersfield area – eight of which required further investigation.

One – Fixby-based Accident Compensations Ltd – was closed down.

The probes come amid a change in the law last April around no-win, no-fee arrangements.

The Government imposed a ban on the referral fees which used to be paid between lawyers, claims firms and others, for profitable claims.

Businesses are now forced to agree written contracts with customers before taking fees.

The change has seen hundreds of firms which deal with personal injuries and mis-sold insurance, close their doors.

The latest figures show that the number of claims management companies registered to handle personal injury claims has fallen from 2,435 in March 2012 to 1,700 in June 2013.

In the Yorkshire area the Claims Management Regulation unit has visited 85 firms since April 2013 resulting in three firms surrendering their businesses and 35 being further investigated.

Justice Minister Helen Grant said: “We have taken strong action to rein in the rogue firms which have gathered in this sector and the impact is now starting to show.

“Ending these fees which fuelled a growing compensation culture has been an important step to reducing the cost of living for ordinary people who have ultimately been footing the bill for them through their insurance premiums.”

Kevin Rousell, head of the Claims Management Regulation unit, said: “It is our absolute priority to protect customers and we are making certain that firms are following the rules at a time of major change for the Claims Management industry.

“We do not tolerate bad practice and continue to take action against companies which break the rules, including removing their licence to trade.

“We shut down more than 200 last year.”

The unit has also been tackling bad practice across the claims management sector, including with the firms which handle PPI claims.

In 2012/13 the regulator cancelled the trading licences of 211 companies, audited 129 and issued formal warnings to 285.

It has now shut down more than 900 firms since being set up in 2007.