In alleged contravention of the Australian Consumer Law, the ACCC alleges that engaged in selling telecommunications goods and services to hundreds of consumers, that they often did not want or need, and in some cases then pursued consumers for debts resulting from these sales.

The ACCC states that many of these consumers were experiencing vulnerability and/or disadvantage, such as living with a mental disability, diminished cognitive capacity or learning difficulties, being financially dependent or unemployed, or having limited financial and legal literacy.

Many of the impacted consumers were First Nations Australians from regional and remote areas or people from culturally and linguistically diverse backgrounds.

“We allege Optus’ conduct disproportionately impacted consumers experiencing vulnerability and/or disadvantage, and that these practices were incentivised by the commission-based remuneration for sales staff," ACCC Chair Gina Cass-Gottlieb said.

"In some cases, we allege Optus took steps to protect its own financial interests by clawing back commissions to sales staff but failed to remediate affected consumers.

“This case concerns allegations of very serious conduct, as our case is that Optus sold goods to consumers experiencing vulnerability which they did not need, did not want and could not afford.”

“We also allege that Optus’ unconscionable conduct continued after management became aware of deficiencies in its systems that were being exploited by sales staff, and despite this, failed to implement fixes,” Ms Cass Gottlieb said.

The ACCC’s case against Optus involves allegations that Optus acted unconscionably in its dealings with about 429 consumers by engaging in inappropriate sales conduct and/or pursuing consumers for debts, including when it knew contracts were created fraudulently.

The conduct included Optus allegedly putting undue pressure on some of these consumers to purchase a large number of products, including expensive phones and accessories, and not undertaking coverage checks to inform the consumer whether they would have Optus coverage where they lived.

It is alleged that Optus engaged debt collectors to pursue many of these consumers, despite knowing that they were subject to inappropriate or fraudulent sales conduct.

The alleged conduct involves 363 consumers from two Optus Darwin stores, 42 consumers from the Optus Mount Isa store and 24 individual consumers from store locations across Australia.

“We are taking this action against Optus and seeking consumer redress in relation to the hundreds of consumers affected by this alleged unconscionable conduct,” Ms Cass-Gottlieb said.

The ACCC began its investigation after receiving a referral from the Telecommunications Industry Ombudsman about concerns regarding Optus’ sales practices to consumers experiencing vulnerability and/or disadvantage.

The ACCC is seeking declarations and orders for penalties, non-party consumer redress, publication orders, a compliance program, and costs.

For its part, the interim CEO of Optus Michael Venter has issued a response detailed below:

We have been notified today of the ACCC’s decision to take action over inappropriate retail sales practices, including involving vulnerable customers.

We sincerely apologise to all customers affected by this misconduct and for the distress caused.

We deeply regret that in these instances we failed to meet the customer service standards that our customers deserve and should expect.

The misconduct alleged by the ACCC is unacceptable, and completely out of step with our company values and we accept that we need to protect all customers, including those experiencing vulnerability, from this type of behaviour.

The majority of the sales occurred at three licensee-operated Optus stores.

We are remediating affected customers including by providing refunds, waiving outstanding debts and enabling them to keep devices. We regret that we did not remediate more quickly in some of these cases.

Optus does not tolerate employee behaviour which takes advantage of customers.

We have taken disciplinary action (including terminations) against staff whom we determined were responsible for this misconduct involving vulnerable customers.

Over the last three years we have undertaken a major review of how we manage sales, especially to vulnerable customers, bringing in new sales systems that give us more oversight, as well as extra, compulsory training programs and enhancements to our IT systems, to help prevent misconduct in sales to vulnerable customers from happening.

As part of our review, we have significantly stepped up our vulnerable customer support through new initiatives, training and programs, including:

· The introduction of a customer advocacy program to improve management of customers facing vulnerability.

· Investment of over $5m in the establishment of a dedicated specialist care team and the development of a new Optus vulnerable customer policy.

· New robust governance and quality assurance programs.

· Changes to credit controls, bad debt monitoring, and we are introducing an improved coverage assessment tool at point of sale.

· Additional and improved mandatory training for all Optus customer-facing staff on appropriate support of vulnerable customers.

We are in the process of appointing a customer advocate in a new role to work alongside our partners, community groups, financial counsellors and our customer teams to focus specifically on improving our support for customers in need.

Optus understands the vital role we play in ensuring vulnerable customers stay connected and we continue to work with external consumer bodies to develop programs to support customers in a position of vulnerability.

We have cooperated with the ACCC in this investigation to date, will continue to do so and are committed to continuing to improve our processes in relation to customers experiencing vulnerability.