BOLTON businesses should be on their guard against a spate of misleading letters that are being circulated about the Data Protection Act (DPA).

The letters offer to register businesses under the DPA for a fee of £117.50, when the annual fee for completing the notification procedure is only £35.

The organisations are cashing in on radical changes to the DPA, which require most businesses to inform the Information Commissioner about the way they process personal data -- failure to do so is a criminal offence that carries a fine of up to £5,000.

Mike Wasinski, a partner at the Manchester office of Hacker Young, said: "Most business people see the Act as a rather daunting and unnecessary piece of extra bureaucracy. The attraction of these letters is that they lead you to believe that by paying a one-off charge you will solve the problem.

"They imply that once you've completed the notification you'll be fully complying with the Act. That is not the case."

Wasinski advises anyone who receives such a letter to contact the Information Commissioners office, which will provide guidance about notification and compliance issues.

Russell Brown of Glaisyers Solicitors goes a step further: "While most

businesses are required to notify the Information Commissioner about the information they retain, they must also comply with eight data protection principles.

"To do so they may need to seek advice from a professional with detailed knowledge of this area of law. Quite often it's necessary to conduct a data protection audit to establish the type of data being retained and how it is held, processed and disposed of."

Mike Wasinski added: "These organisations are making a profit of around £80 on each respondent but leave behind them a trail of unsuspecting businesses clinging to the mistaken belief that they have secured compliance under the Act."