Ofcom fines Plusnet £880,000 for billing over a thousand ex-customers
Plusnet has been fined £880,000 by UK telecoms regulator Ofcom for continuing to bill more than a thousand ex-customers after cancelling their contracts.
Remaining funds have been donated to a dozen local charities
The BT-owned company was found to have continued billing a group of customers for their cancelled landline or broadband services. Following an investigation, Ofcom ruled Plusnet broke a fundamental billing role and will be subject to a fine after the 1,025 customers were overcharged by more than £500,000 in total.
“There can be no margin for error, and no excuses when it comes to billing customers correctly,” says Lindsey Fussell, Ofcom’s Consumer Group Director. “This fine should serve as a reminder to telecoms companies that they must adhere to Ofcom’s billing rules at all times, or face the consequences.”
Plusnet’s fine arrives just a few months after Ofcom issued a £2.7 million penalty to EE for overcharging its customers in the hope of discouraging others. “We monitor how companies bill their customers, and will not tolerate careless mistakes. Any company that breaks Ofcom’s rules should expect similar consequences,” said Fussell.
1,025 customers were overcharged by more than £500,000 in total
Whereas Ofcom noted EE did not attempt to reimburse customers until the regulator intervened, Plusnet made repeated attempts to refund the affected ex-customers by letter and by phone. The provider refunded 356 ex-customers a total of £212,140, which included four percent interest for each customer.
“This is a massive wake up call to check your bank statements for unwanted transactions and querying anything that seems out of place," comments Hannah Maundrell, Editor-in-Chief of Money. "Don’t let mistakes like this damage your confidence in switching supplier. Issues tend to be few and far between and if you stay loyal you will pay loads more than you need to."
In lieu of the payments due to overcharged parties the provider was unable to contact, the remaining funds have been donated to a dozen local charities. Plusnet has since taken steps to prevent similar billing errors in the future.
The £880,000 penalty must be paid to Ofcom within 20 working days and will be passed on to HM Treasury. A 20 percent reduction has been included “to reflect Plusnet’s willingness to enter into a formal settlement, which will save public money and resources.”
Plusnet admits and takes full responsibility for the breach of Ofcom’s billing rule.
What are your thoughts on Ofcom’s ruling in the Plusnet investigation? Let us know in the comments.