Fine of £13.3m dished out by Ofcom after EE and Virgin Media found to have been over-billing customers who ended their contracts early.
The telecoms regulator said there were around 400,000 EE customers who paid up to £4.3m too much, as a result of being over-billed when they ended their contracts early. Similarly, Virgin Media are accused of over-charging around 82,000 customers by almost £2.8m.
Gaucho Rasmussen, director of investigations and enforcement at Ofcom, said: “EE and Virgin Media broke our rules by overcharging people who ended their contracts early. Those people were left out pocket and the charges amounted to millions of pounds.”
Set to appeal the decision, Virgin Media has been fined £7m, with an additional £25,000 for providing incomplete information to the regulator. This was after Ofcom found Virgin Media had levied early-exit charges that were higher than customers had agreed to when signing up to their residential contracts, a practice that went on for almost a year.
“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,” said Tom Mockridge, chief executive of Virgin Media.
Saying it had mistakenly overcharged some of its customers, Virgin Media has already paid out reimbursements or made charity donations covering 99.8% of its overcharging.
EE, which was fined £6.3m, apologised to customers after Ofcom discovered the mobile operator, for the last six years, had not set out to its mobile customers, the charges that would be incurred if they left their contract early.
A spokesperson for EE 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.”
According to Ofcom, £1.6m of the £4.3m overcharging fees had not been repaid. Apparently, EE did not have the records covering the whole period of mischarging. Customers who feel they may have been overcharged should contact EE.
Ofcom is in a stronger position than ever when it comes to protecting consumers, thanks to government backing. Companies are being told to play by the rules and ensure they treat their customer honestly and fairly.
Gillian Guy, chief executive of Citizens Advice, said: “Anyone who has been affected by this deserves a refund.
“This is another in a long line of failings in the mobile and broadband industry – we need an independent consumer champion to stick up for customers and stop this from happening.”
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