Optus to refund customers after cutting data without telling them

ACCC Commissioner Sarah Court talks about a court enforceable undertaking from Optus agreeing to compensate customers after providing less data to consumers than what was advertised to consumers.

Introduction – Optus refunding customers

Ross Greenwood: Welcome back to Money News right around Australia. If there’s one thing that I have a bugbear with, it’s about the contracts that we receive these days. I don’t care whether it’s your credit card contract or whether it’s your mobile phone contract or your broadband plan, whatever it might be, I challenge you to read the contract. That’s the first thing, and then secondly, understand it.

When you see all sorts of things come through on –I don’t know. Even your iPhone plan or your bank or whatever it is, they send “We’ve made some changes”. But do you ever really have a look? When you update your phone, do you actually have a look on the new versions and what it really means to you? Of course, you don’t. Because life’s too busy.

We’re not lawyers and we shouldn’t be expected to be lawyers either. Then you discovered that say the ACCC, the Australian Competition and Consumer Commission that does read these plans sometimes, especially when there’s complaints, and discover that say Optus has reduced inclusions and shortened expiry periods in August 2015 for certain areas when it came to mobile phone and mobile plans.

Now, it didn’t tell its customers. What’s happened now is that there’s a fight and Optus is going to have to compensate those customers. But I wonder whether their customers would prefer to be compensated with the extra data or just a small amount of money that may can handle that [sic]. I don’t know. Let’s get the commissioner from the ACCC, Sarah Court, who’s been involved in this. Many things for your time, Sarah.

Interview – Sarah Court, Commissioner ACCC

Sarah Court: It’s a pleasure, Ross.

Ross Greenwood: All right. Now, any organization that goes and advertises something to get customers in, they must make good on those promises that they’ve made in the advertisements that they put out there, don’t they?

Sarah Court: That is true, Ross. Absolutely true.

Ross Greenwood: That’s basic consumer law. In this particular case, what you’ve suggested is that Optus, in this particular case, has basically changed the deal without telling the customers, after they’ve got them in there, offering them five gig of data that was valid for 30 days with a certain phone or a certain modem, whatever it might have been, but in actual fact, it changed. It made it only 2 gigabytes of data and only valid for 14 days?

Sarah Court: Yes, that’s right Ross. It’s covered quite a few of the Optus prepaid devices. So important for your listeners to know this is related to prepaid devices that was sold, as you said, that the change came in about 2015. But interestingly in this case, it wasn’t actually ACCC that picked this up. It was a very savvy consumer who had purchased quite a lot of these devices, probably sim cards and said, “Well, this looks like a really good deal, so I’m going to take advantage of that”.

Then when he, after 2015, started to notice the data running out a lot more quickly than he had anticipated. He was on to it and brought it to our attention. We commend that consumer, but recognizes a lot of us, as you said in your intro, that don’t have the time to really look at the detail in the same way.

Ross Greenwood: And yet the interesting thing is we need organizations such as yours who have got the power to be able to bring organizations to our attention. I don’t necessarily want to single out Optus here because I’m sure that it would happen with other organizations as well. But unless consumers are savvy enough to read those contracts or to realize that what they have bought is not necessarily what they are being provided, it makes it very difficult to actually get some reasonable sense of justice out of these things.

Sarah Court: All of that’s right, and we, as I’ve said, commend this consumer. He was right onto it. Then that launched an investigation on our part, and we found that the conduct involved quite a number of these prepaid plans, and so we’ve been working with Optus. As you say, they’ve been giving us a call-in for us to be undertaking and the affected consumers are going to get some redress for their out of pocket for this issue.

Ross Greenwood: The Optus spokesperson said, “We will provide credit, refunds and/or equivalent benefits to customers who are affected. Publish public notices in stores and on Optus websites and provide an undertaking to implement an upgraded and enhanced compliance program for its prepaid products”.

Now, that’s all very well for Optus to say that in hindsight. The truth is, you’d either A, want the organization to self report if they have done the wrong thing; and/or secondly, to basically honor the commitments they make and track the commitments that they actually make out there so they know they are honoring them. I think that’s the key here, isn’t it?

Sarah Court: Look, it is. About 30,000 consumers were potentially impacted by this, Ross. This is not just a couple of consumers here or there. This conduct, where consumers are told one thing and then ultimately get another, is something that we take very seriously. We welcome that the consumers are going to get compensation on this occasion obviously, but it has required an investigation by the ACCC to get there and as I say, a very savvy consumer to led [sic] us to the issue.

Ross Greenwood: I know you have to investigate. I know you need a tip off from a savvy consumer. Can I just ask one other thing? This occurred apparently in August 2015. It is now not too far away from August 2017, so let’s say 22 months since this originally occurred. Why does it take so long? Why can’t this all be sorted out in the space of three or four months or something like that, if a company is seen to have not necessarily honored a promise or a commitment that it’s made?

Sarah Court: Well, this came to our attention from the consumer we’ve been talking about in May last year, Ross. It came to our attention about 12 months ago. We then liaised with Optus, get the documents that we need, make sure that we can understand the extent, how many consumers are affected and all of that takes a bit of time.

And then in this case, we have a couple of options in a case like this. We can either take court proceedings and try to get consumer redress that way or we can get a statutory undertaking. We thought on this occasion, we’re going to go the quick efficient way. We’re not going to go and take the matter to court, but we want to get consumers the right outcome as soon as we can. But yes, unfortunately, those things occasionally take a bit more time than we’d like, but in 12 months or so, we’ve got those consumers the redress that they need.

Ross Greenwood: Yes, because of course, the thing that most people would like to see is that any justice that is required can happen as quickly as possible from your point of view, but also from those consumers point of view as well. Commissioner with Australian Competition and Consumer Commission, Sarah Court. I presume those customers are going to be contacted by Optus. They’re going to be offered either data or presumably there might be even offered some cash as well. Sarah, we appreciate your time here on the program tonight.

Sarah Court: It’s a pleasure. Thanks for having me.

 

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