Thousands of customers are being refunded over $21 million by Telstra, after they were charged for “inactive” internet services during an 11 year period.
The telco has also agreed to pay a $3.01 million fine for breaching accuracy rules, which is what led to over 6,500 customers being wrongly charged $2,600 each. It was Telstra who discovered the breach, and self-reported it.
$17.7 million has already been refunded, including interest, and the remaining $3.4 million is set to be repaid by the end of this year.
Despite the company taking steps to rectify the breach, the ACMA (Australian Communications and Media Authority) chair Nerida O’Loughlin said she’s “lost patience” with Telstra, following a “series of significant billing errors.”
“Telstra has a history of incorrectly billing customers and it’s just not good enough.”
“At a time when many small businesses are facing economic pressures, unaccounted costs can create very real stress and financial hardship.”
“All telcos must have robust billing systems in place to ensure that consumers, including small businesses, are only paying for agreed and active services.”
This fine comes after the ACMA directed Telstra to comply with billing accuracy rules, in September 2020. This was after over 10,000 customers were overcharged almost $2.5 million during a 12 year period.
Another separate investigation found over 11,000 customers were overcharged around $1.7 million by the telco.
Telstra has told the ACMA the billing issues were caused by them failing to follow a series of steps in its ADSL internet service deactivation process.
Ms O’Loughlin continued, “Telstra is a major player in the Australian telco sector and it needs to continue to prioritise its billing compliance and get its systems in order.”
Group Executive for Global Business Services at Telstra, Dean Salter apologised and said the company “let these customers down.”
“Getting something as important as billing wrong isn’t acceptable, and this is clearly not the experience we want to be providing our customers.”
“These ADSL billing errors occurred because we didn’t follow the proper deactivation process, including when some customers migrated to the NBN, which resulted in some customers being charged for inactive services. We’ve reached out to our customers to explain what went wrong and what we’re doing to fix it, including refunding them for the incorrect charges with interest.”
“We know our customers deserve better, which is why we reported the issue to ACMA and conducted our own extensive investigation. We have put new controls in place to prevent this issue from happening again, including monthly checks if ADSL services are being used by customers before they’re billed.”
The company has also agreed to report back to the ACMA in six months, about the effectiveness of these controls. If said controls fail or further breaches occur, the ACMA warned they would sure the telco in the Federal Court.
This fine is separate from a $306,360 penalty Telstra was issued last week by the ACMA for failing to provide correct details to a public database. Emergency services use this database to locate people should a natural disaster take place.
This breach was also discovered during an internal investigation by Telstra.
