BUSINESSES are being warned about a scam which claims they need to pay to comply with the new data protection law.

Official-looking papers from a company called The Data Collection Enforcement Agency requests companies to send £95 to register.

The form, which suggests that it is a criminal offence not to act on the document, is being sent to unsuspecting companies in both Worcestershire and Herefordshire.

Leominster-based planning and architecture firm, David Taylor Consultants Ltd, alerted the county's chamber of commerce after receiving the forms.

"This form is an outrageous attempt to extort hard-earned cash from local businesses," said Peter Morgan, the chamber's press and marketing manager.

"A local firm approached us to say they had received the documents which looked official, but contained suspiciously poor use of English.

"If anyone receives documentation from the Data Collection Enforcement Agency or from a company called Data Protection Act Registration Service, they should ignore it and send details to the local trading standards office.

"These companies are confusing and troubling local firms.

Businesses can see what they have to do under the 1998 Data Protection Act by ringing 01625 545740 or by clicking onto www.dr.gov.uk