EE and Virgin Media fined £13.3m for overcharging 500,000 customers

Marco Green
November 18, 2018

The national United Kingdom telecoms regulator has today fined mobile operator EE and cable broadband ISP Virgin Media a combined total of £13.3m for overcharging customers (those on discounted deals) who wished to leave their contracts early.

Both companies failed to make sufficiently clear the charges customers would have to pay if they ended their contract early, concluded the regulator, which described the companies' actions as "unacceptable".

EE, Britain's biggest mobile operator, was fined £6.3m and Liberty Global-owned Virgin Media was fined £7m.

The fine arose because Virgin Media overcharged some cable cusotomers for early termination between September 2016 and 2017. On top of that Virgin's fine was pushed up slightly after they provided "incomplete information in response to a statutory information request".

The probe discovered that for nearly a year, Virgin Media imposed early-exit charges that were higher than the figures customers signed up to.

"Virgin Media has always informed both existing and potential customers that our contracts apply over a specific period, that ending a contract early may result in a fee being charged and that they should consider the length of contracts before entering into them".

"We profoundly disagree with Ofcom's ruling", Tom Mockridge, CEO of Virgin Media said in a press release. The regulator said some 6,800 customers were overcharged by more than £100.

Virgin Media has refunded or made donations to charity on behalf of 99.8 per cent of all those affected and has reduced the level of its early exit charges. The company also promised to review its processes.

EE and Virgin Media fined £13.3m for overcharging customers
Virgin Media And EE Fined Total Of £13.3 Million For Overcharging Customers

Ofcom says EE has refunded just over £2.7 million to the affected customers it has been able to identify, which means up to £1.6 million has not yet been refunded.

He added: "This unreasonable decision and excessive fine does not reflect the swift actions we took, the strong evidence we have presented, or our consistent, open and transparent cooperation with the regulator".

But Virgin Media vowed to appeal against the decision and fine, which it said was "unjustified and disproportionate".

The regulator's rules state any early-exit charges for mobile, broadband and phone contracts must be clear, comprehensive and easily accessible so people know their rights before they buy a service.

Some customers appear to have avoided the charge and the EE estimate of what was over charged is up to £4.3m.

"We accept Ofcom's findings and recognise that we have made a mistake", said an EE spokesperson.

Making sure that broadband consumers can easily switch between providers is one of the key aims for Ofcom and as various alternate broadband infrastructure appears making it cheaper and simply to switch between them is important, particularly as not all retailers sell the full fibre services and as firms like Vodafone roll-out further this will become more of a problem.

"Ofcom is sending a serious message to all telecoms providers with these fines and it is heartening to see the best interests of consumers being prioritised".

Other reports by Click Lancashire

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