Telcos Face Slap Over Late Fees
This comes on the heels of a court ruling that found late payment fees enforced by banks, including ANZ Bank’s $20-35 fees on late credit card payments are “unconscionable”. Initially thousands, if not millions, of Telstra customers could be compensated for late payment fees after Sydney law firm ACA Lawyers announced plans to launch a class action before Christmas.
Millions of Telstra’s fixed line, mobile and data customers will be able to join the class action. They will be followed by customers from Optus and Vodafone.
ACA Lawyers will argue that the fees are unlawful because they do not reflect the actual costs incurred by the telco.
Said Steven Lewis, principal at the firm: “Just by way of example, in 2014 Telstra took in $272 million in late payment fees and what they call ‘other miscellaneous fees’. We believe the vast majority of that amount relates to late payment fees.”Based on Telstra’s financial results, he estimated that the telco has collected hundreds of millions of dollars in late fees over the past five years.
“If you go back over the last five years, Telstra has recovered close to $750 million in late payment fees and other miscellaneous fees. It’s hard to see how Telstra could justify a 20 percent impost as being a genuine pre-estimate of their costs,” Lewis said.
A Telstra spokesman said the company’s late fees were reasonable in light of the costs incurred. “We will strongly defend any claim we receive,” he said.