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Thousands of Telstra customers charged for ringtones and games they didn’t want

Telstra is in the spotlight over charging irregularities.

Telstra is in the spotlight over charging irregularities. Photo: Getty

Telstra has admitted more than 100,000 people may have been charged for content they did not mean to sign up for.

Thousands of Telstra customers were unknowingly signed up to subscription services or charged for content including ringtones and games, without having to enter payment details or verify their identity.

The telco admitted to misleading customers with its Premium Direct Billing (PDB) service, which allowed mobile phone customers to purchase digital content from third parties and have it charged to their Telstra bills.

Telstra is facing $10 million in penalties for making false or misleading representations and has made a joint submission with the ACCC to the Federal Court.

“You may have got on the app thinking, ‘I’ve got to put in a credit card or something to sign up, and so until I’ve done that I haven’t signed up’,” ACCC chairman Rod Sims said.

“In fact, Telstra had set up a system with the app developer whereby you were billed through your Telstra bill.

“We allege many, many customers didn’t know that.”

In a statement, the ACCC said Telstra was aware from early 2015 the service led to a large number of people being charged for content without their knowledge or consent.

“When customers contacted Telstra to complain, many were directed to third parties, even though Telstra knew that they had difficulty getting a refund from third-party suppliers, or cancelling their subscription,” Mr Sims said.

“Customers were often left frustrated and out of pocket as a result of Telstra’s conduct.”

Telstra said it exited the service entirely earlier this month.

“It is clear for this specific type of service, we did not get that right,” Telstra executive Vicki Brady said in a statement.

“A large proportion of customers who decided to subscribe to a service were happy with it; however, the number of complaints received over time shows there were issues with the [premium direct billing] service that needed to be addressed.

“We apologise to our customers who have been charged for PDB subscription services they did not knowingly request or could not opt out of.”

Telstra agreed to contact affected customers and offer refunds.

The telco estimated at least $5 million in refunds had already been provided.

Optus, Vodafone next in watchdog’s sights

Mr Sims said the ACCC was aware of other carriers offering similar services and had received complaints about Optus and Vodafone.

“We’ll be writing to Optus and Vodafone fairly soon, putting them on notice about our concerns with their behaviour,” he said.

Mr Sims urged customers of those providers to seek a refund if they believe they had been misled and charged for content they did not intend to sign up for.

“I think that now we’ve got these joint submissions going to the court in relation to Telstra, I suspect Optus and Vodafone would take notice.”

-ABC

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