TELECOMS WATCHDOG Ofcom has slapped EE and Vodafone with a £13m fine for overcharging phone and broadband customers who wanted to leave their contracts early.
A probe into early exit charges at the two firms found that around 400,000 EE customers were overbilled for ditching their contracts to the tune of £4.3m, while almost 82,000 Virgin Media customers were overcharged a total of £2.8m.
As a result, Ofcom has fined the BT-owned EE £6.3m and Virgin Media £7m for “failing to make sufficiently clear the charges customers would have to pay if they ended their contract early.”
Ofcom’s investigation found that over a six-year period, EE did not set out the charges its mobile customer would have to pay if they left their contracts early, adding that up to 15 million discount contracts for EE’s mobile, landline and broadband customers left them paying excessive early exit charges.
And in the case of Virgin Media, the watchdog found that the operator had levied early-exit charges that were higher than customers had agreed to when signing up to their residential contracts for almost a year.
Gaucho Rasmussen, Ofcom’s director of Investigations and Enforcement, said: “EE and Virgin Media broke our rules by overcharging people who ended their contracts early. Those people were left out of pocket, and the charges amounted to millions of pounds.
“That is unacceptable. These fines send a clear message to all phone and broadband firms that they must play by the rules, in the interests of their customers.”
Both companies have since agreed to change their terms and reduce exit charges, Ofcom said, but Virgin Media has vowed to appeal against the watchdog’s decision to fine the company.
Tom Mockridge, chief executive of Virgin Media, said: “We profoundly disagree with Ofcom’s ruling. This decision and fine is not justified, proportionate or reasonable.
“A small percentage of customers were charged an incorrect amount when they ended one or more of their services early and for that we are very sorry.”
An EE spokesperson said: “We’ve already refunded customers and changed the way we calculate early termination charges, and we will continue to focus on ensuring our policies are clear and fair for all customers.” µ
Source : Inquirer