In the last two months, membership of the Claims Standards Council has dropped from 193 to 90. This hasn't prevented a "significant" number of claims management companies (CMCs) looking for business in the same period.

Established in September 2004, the Claims Standards Council represents those interested in the development of regulation in the UK. Member-companies agree to operate by a code of conduct. As membership is voluntary, only a small proportion of claims management companies are members. The CSC website will soon offer information regarding whether or not a company is a member of the Council.

The threat of legislation had led to membership growing rapidly. The CSC has minimal entry requirements and offers a number of advantages to its members. These include the possibility of using membership as a marketing device.

The Council's aims include:

Vetting individuals and organisations seeking membership.

Setting out the required process for handling claims.

Providing a forum for dealing with complaints and disciplinary matters.

The CSC has been subject to a great deal of criticism from personal injury lawyers and has been on the receiving end of verbal and physical abuse from some CMCs. Last month a paving slab was mailed to the CSC via their freepost service costing £400.

Until regulation comes in during the autumn, the CSC provides voluntary regulation of the industry. Membership indicates that firms are willing to abide by an independent code of practice. Regulation has been welcomed by both the TUC and Citizens Advice Bureau.

Policy advisor to the CSC, Andy Wigmore said, "There has been an upsurge in the market in the past few weeks. We have seen a lot more advertising, cold calling and people out on the street. " He estimated that up to fifty CMCs would remain in the regulated market.

The CSC describe those companies leaving as the "one or two-man bands that cause problems for the market." Upcoming regulation is expected to reduce the numbers of CMCs significantly. Wigmore disagrees with the recent estimate of 500 CMCs. "I have only ever found 240 true claims companies. "I think they are reducing in number by the month. I'm starting to see a massive reduction in the activity."

The CSC has recently assisted in investigations of six of its members, based in Sheffield, Wigan, and Portsmouth. Trading Standards, the Inland Revenue and the Serious Fraud Office have been conducting the investigations over the last year.

An increased number of public complaints is expected by the CSC in May when it launches its website.