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Ofcom takes action on mis-selling
(01-04-08) - All communications providers will be forced to sign up to a dispute resolution scheme to deal with customer complaints under new rules being introduced by the telecoms regulator Ofcom.
Ofcom launched an investigation into fixed-line mis-selling in 2005, which covers all types of mis-selling, including:
Slamming, where a consumer is switched to another provider without their knowledge
When communications providers fail to provide important information to consumers such as the minimum contract duration or details of early termination fees
When communications providers refuse or make it difficult for consumers to switch to a different supplier
When communications providers pass themselves off as other companies
The investigation saw complaints fall from a peak of 1,200 a month in 2005 to just 350 a month in January 2008. However, Ofcom said it now has to expand its investigation because “the rise of new products such as those based on local loop unbundling is now fuelling an increase in consumer complaints”.
Communications providers must now confirm that they will sign up to a dispute resolution scheme such as Otelo or Cisas or provide evidence for not being classified as a communication provider if they are to avoid a fine of 10 per cent of relevant turnover.
Ed Richards, Chief Executive of Ofcom, said: “Far too many consumers are being misled by fixed-line companies and this investigation will lead to take firm action against those who disregard the rules. We want to make sure that consumers are treated fairly and are able to take full advantage of the increasing choice and lower prices that competition is delivering.”
Michael Phillips, BroadbandChoices.co.uk product director, said: “Consumers often find it very difficult to resolve disputes with providers and many people do not realise that some ISPs are not yet members of these schemes.
“These new rules will ensure that no customer is left without some course of action against mis-selling, though actually resolving a problem is still a long, drawn out process that many people still don’t realise is even available.”
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