Optus fined $10 million for unfairly billing customers for third-party mobile phone services

Australia’s second biggest telco has been fined $10 million for unfair billing practices — with thousands of customers also potentially eligible for a refund.

OPTUS has been slapped with a $10 million penalty for misleading customers and charging them millions of dollars for third-party services they subscribed to by mistake and couldn’t easily stop.

And the company may face millions of dollars more in refunds as Australia’s consumer watchdog warned victims were entitled to refunds and many had yet to come forward to collect them.

The massive fine was handed down by the Federal Court following an Australian Competition and Consumer Commission investigation into carrier billing for third-party services, such as ringtones and phone wallpapers.

It found Optus collected $195 million from its customers for the premium services, earning more than $65 million in commissions.

READ MORE: Telstra unfairly billed more than 10,000 customers

ACCC Chairman Rod Sims said Optus customers should check their bills carefully. Picture: John Feder/The Australian

But the carrier also received more than 600,000 enquiries from customers, the ACCC found, and failed to inform them “direct carrier billing” was enabled on their accounts by default, did not have adequate identification procedures, and referred customers back to the third parties to stop the charges or obtain refunds.

ACCC chairman Rod Sims said Optus’ behaviour was “simply unacceptable” and deserved the large penalty imposed by the Court.

“In many cases, Optus customers had no idea they were buying anything and certainly did not need or want the content for which they were being charged,” Mr Sims said.

“Optus failed to take appropriate action, choosing instead to continue to charge customers and collect commissions on these sales even after numerous complaints.”

Optus regulatory and public affairs vice-president Andrew Sheridan said the company stopped offering the third-party services in August last year “other than a limited number of services for one-off purchases”.

“Optus once again apologises to affected customers and reminds them to contact Optus to discuss their circumstances via our complaints handling form or through managing third-party content,” he said.

Optus has so far paid $8 million in refunds to customers but Mr Sims recommended anyone who believed they had been unfairly billed for premium services phone the company on 13 39 37.

Rival Telstra was also fined $10 million in April last year after the Federal Court found it had unfairly collected fees for third-party premium services from more than 100,000 customers.

Originally published as Optus fined $10 million for unfairly billing customers for third-party mobile phone services