Vodafone fined £4.6m for breaches of consumer protection laws

The most complained about telecoms provider Vodafone has been fined £4.6m by Ofcom for “serious and sustained breaches of consumer protection rules”.

Ofcom undertook two investigations lasting 18 months. The first was started on June 15th 2015. Following its investigation, Ofcom decided to issue Vodafone with a notification under s96A of the Communications Act 2003 (the “Act”) on 15 April 2016 as they had reasonable grounds to believe that it had contravened consumer law between 26 May 2011 and 28 September 2015.

Vodafone provided written representations to Ofcom on 1 July 2016. Ofcom and Vodafone entered into settlement discussions and on 24 October 2016 Vodafone wrote to Ofcom admitting its liability in relation to the nature, scope and duration of the contraventions.

In a second investigation, Ofcom were found not to have procedures, effective to “ensure” the fair and timely resolution of complaints, to clearly established timeframes; and not securing, a Written Notification (details of a dispute resolution scheme) was sent to customers if a Complaint remained unresolved after 8 weeks and no relevant exceptions applied. The investigation took place between 1 January 2014 and 5 November 2015 and Vodafone were fined £925,000.

As a result of these failings, two penalties have today been imposed against Vodafone: £3,700,000 for taking pay-as-you-go customers’ money without providing a service in return; and £925,000 for the flaws in its complaints handling processes.

The penalties incorporate a 7.5% reduction to reflect Vodafone’s agreement to enter into a formal settlement, which will save public money and resources. As part of this agreement, Vodafone admits the breaches. It has also reimbursed all customers who faced financial loss, but for 30 it could not identify, it made a donation of £100,000 to charity.

The money, which must be paid to Ofcom within 20 working days, will be passed on to HM Treasury.

The substantial fine sends out a message to telecoms companies that these breaches in consumer law, not ensuring adequate staff training and treating customers badly will not be tolerated. Telecoms companies need to up their game instead of continuing to be the bottom of the pile when it comes to customer service.

Marcus Williamson, editor of the website CEOemail.com which provides the email addresses for any CEO, has seen a rise over the last few years of people searching for telecoms CEOs. He says “I’ve seen a steady increase in people seeking to complain to the CEO of Vodafone when customer services has failed them. As a communications company they must work to improve their own customer communications, which are frequently unclear and confusing.“

So what do you do if you need to complain about a telecoms provider?

  • Keep evidence and write wherever possible. Laws around recording calls are unclear and complicated so you may not be able to use them in court should you need to do so
  • Refer to the correct consumer law. (Consumer Rights Act 2015 states that you are entitled to services to be carried out with reasonable skill and care. Consumer Protection from Unfair Trading Regulations 2008 covers mis-selling)
  • Ensure you set a deadline for response and tell them what you will do if not satisfied
  • Write to the CEO, who is unlikely to respond in person but the complaint will be escalated
  • Ask for a deadlock letter. If the complaint is still not resolved then take the complaint to either of the Telecoms Ombudsmen: CISAS or Ombudsman Services

All you need to know about complaining to telecom providers everything you need to know about laws etc when complaining.

GET THE BOOK! How To Complain: The ESSENTIAL Consumer Guide to Getting REFUNDS, Redress and RESULTS!

Vodafone were in the news earlier in the year:

Money Box Vodafone

BA flies in the face of consumer law and decency

Customers who bought tickets for the economy cabin on short-haul and domestic flights from Heathrow and Gatwick flying from January 11, 2017, and from London City and London Stansted by summer 2017 are being stung and will find that food and drinks are no longer free! Has it become a no frills airline? On the 29th September this year BA announced to great fanfare that it had partnered with Marks and Spencer. The new British Airways menu, which will replace the airline’s current complimentary snacks, includes items from the M&S Food on the Move selection. Well that’s nice isn’t it? Well maybe spending a few quid might be better than the free alcoholic drink and a few free nibbles in the future but what about those people who bought their tickets before the 29th September? They lose out, that’s what.

You may think that customers only lost the cost of a drink and a few nuts. But stop, don’t flee yet. How many tickets do you think were purchased before the 29th September this year for flights after the 11th January 2017? Thousands? Tens of thousands? Ok, so just how much have they actually saved? That’s the principle after all. Couple of pounds on every flight, you do the math, it’s thousands and thousands of pounds right?

“Oh” I hear you cry “But BA will refund the cost of the “free” drink and nibbles so they won’t make that money”. Really? It wouldn’t appear so. Those people who have already booked flights received an email starting with “Thank you for booking your flight with British Airways. We’re writing to let you know about some key changes that are taking place to our on-board catering.” The press release followed. There is no mention at all of compensation, partial refund or how to make a complaint. They may not refuse any calls of this nature but why the lack of transparency or assistance for customers. There’s nothing on their website either!

I asked the BA Press Office for a response and so far have not received one. I tweeted BA and they said all flights after 11th Jan will have new catering menu. “Breach of contract” says I and here is their stance on that:

@Airways 

@ComplainingCow Hi Helen, sorry for the delay in replying. We’ve given our customers a four month notice period of the changes… most short-haul customers do not book this far in advance, but any customers who hold bookings from January 11th 2/3… and are unhappy are welcome to contact us to discuss their booking.

So, there you go. BA will discuss your bookings but will not actively point out that they have broken the terms and conditions of contracts.

Right, well that’s it. It’s the principle of the thing. It doesn’t matter if you think it is only a few quid or you are just a bit miffed or even if you don’t care. BA appears to be making money from this. Instead of doing it properly and offering vouchers/AVIOS points or partial refunds to affected customers it would appear that it has simply informed them that the terms and conditions have changed and hoped that the majority of people won’t bother complaining. They would not be out of pocket and the PR would have been much better showing them to be doing the “right thing”.

So, we can’t catch all the customers affected and of those we catch we can’t get them all to complain. But we can have a damn good try at knocking the BA profits and making sure customers actually get what is legally due. How? Like this:

  • Email the CEO. You can find his address at ceoemail.com
  • Provide details of when you bought the tickets and the booking reference numbers
  • Tell him that BA is in breach of contract for breaking the terms and conditions of the contract you have.
  • Say that you are aware that the breach falls under The Consumer Contracts (Information, Cancellation and Additional Charges) Regulations 2013, Regulation EC 1008/2008 – Article 23 Transparent pricing, Consumer Protection from Unfair Trading Regulations 2008 and Consumer Rights Act 2015 (including Part 2 Unfair Terms).
  • State that you are entitled to a full refund on the ticket or you will accept a partial refund for the value of the “free” drink and food that formed part of the contract. (Both ways!)
  • Inform him that should you not receive a satisfactory response you will not hesitate in taking the matter further such as the Alternative Dispute Resolution Scheme.
  • Optional – say that you are disgusted with the way BA has handled this matter and will be spreading awareness of people’s legal rights via social media. (And then of course do so, the more people we empower to fight for their rights the better so do your bit!)

Don’t be fobbed off by any  requests to call an 0844 number either as these are no longer permitted for after-sales enquiries and issues, Regulation 41 of  aforementioned Consumer Contracts (Information Cancellation and Additional Charges) Regulations 2013. Refuse to ‘phone anyway because you want your answer in writing should you need the evidence! A call won’t give you that. Why you should write not ‘phone to complain effectively.

If you bought your ticket(s) through a travel agent you will need to contact them as if you paid the travel agent directly the contract is with them.

Beat BA at their own game and don’t let these big businesses get away with it. Call them out on it and ensure you get your legal redress whilst you are about it.

If you want to do more about asserting your legal rights and need some help. See the Top 20 Tips for complaining effectively and the book How to Complain: The Essential Consumer Guide to Getting Refunds, Redress and Results packed full of information, guidance, advice, consumer law and template letters.