Monday, 02 December 2019 10:29

Optus cops $6.4 million penalty for misleading consumers over Internet disconnections Featured

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Optus has been hit with a $6.4 million fine by Australia’s competitition regulator for making misleading claims about home Internet disconnections to consumers.

This is the second time in two years that the Federal Court has ordered Optus to pay significant penalties for misleading consumers about the need to acquire NBN services following action by the Australian Competition and Consumer Commission(ACCC).

Australia’s second largest telco has been penalised after it emailed 138,988 of its own mobile customers claiming their existing home broadband services, provided by Optus’ competitors, would be “disconnected very soon”.

The email on 24 May 2018 encouraged the customers to change to Optus NBN Broadband, telling them to “make the switch, before it's too late”.

The Federal Court found that this statement was misleading or deceptive because the customers who received the email were not facing immediate disconnection of their existing broadband services.

“We are concerned about Optus’ recent track record in misleading consumers about the NBN. We expect that this $6.4 million penalty will serve as a warning to Optus and other telcos that they must not mislead consumers about their choices when the NBN is being rolled out,” ACCC Chair Rod Sims said.

“As the NBN rollout nears completion, consumers around Australia are making decisions about whether and when to move onto the NBN, and what services are best for them.

“The industry should be helping consumers during this process, not providing them with misleading information. We are continuing to watch this area closely.”

“We took this case against Optus because we were concerned its emails created a false sense of urgency for consumers and may have discouraged them from shopping around for the best deal available,” Sims said.

The ACCC instituted proceedings against Optus on 24 June 2019.

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Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).

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