Vodafone fined £4.6 million for failing customers 26 October 2016
Ofcom investigation uncovered mis-selling, inaccurate billing and poor complaints handling procedures
Vodafone will be fined £4,625,000 by Ofcom for serious and sustained breaches of consumer protection rules.
The penalty is the result of two investigations into Vodafone completed by Ofcom today.
One investigation found that 10,452 pay-as-you-go customers lost out when Vodafone failed to credit their accounts after they paid to top-up' their mobile phone credit.1 The affected customers collectively lost £150,000 over a 17-month period.2
Vodafone also failed to act quickly enough to identify or address these problems, which stemmed from the company transferring to a new billing system.3 Only after Ofcom intervened did the company take effective steps to stop pay-as-you-go customers from paying money for nothing, and to reimburse those affected.
Vodafone also breached Ofcom's billing rules, because the top-ups that consumers had bought in good faith were not reflected in their credit balances.
In a second investigation, we found that Vodafone failed to comply with our rules on handling customer complaints.
Vodafone's customer service agents were not given sufficiently clear guidance on what constituted a complaint, while its processes were insufficient to ensure that all complaints were appropriately escalated or dealt with in a fair, timely manner.
Vodafone's procedures also failed to ensure that customers were told, in writing, of their right to take an unresolved complaint to a third-party resolution scheme after eight weeks.
Financial penaltiesAs 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 money, which must be paid to Ofcom within 20 working days, will be passed on to HM Treasury.
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, and made a donation of £100,000 to charity.
Lindsey Fussell, Ofcom Consumer Group Director, said: Vodafone's failings were serious and unacceptable, and these fines send a clear warning to all telecoms companies.
Phone services are a vital part of people's lives, and we expect all customers to be treated fairly and in good faith. We will not hesitate to investigate and fine those who break the rules.
The investigationsOfcom opened two parallel investigations into Vodafone in June 2015.
Evidence showed Vodafone breached a number of General Conditions (PDF, 449.4 KB )' the rules that all telecoms companies must observe, which are designed to protect customers.
Pay-as-you-go investigationOfcom found that Vodafone took money from pay-as-you-go customers but provided nothing in return. This was as a result of problems that occurred when Vodafone moved customers to a new billing system.
Vodafone disconnects inactive pay-as-you-go accounts after a certain period of time and recycles the numbers, a common practice in the industry.
Where a pay-as-you-go phone has not been used or topped-up' for 270 consecutive days, Vodafone puts the customer's SIM card into a pre-disconnection state' for up to 24 hours, before disconnecting it from its network. During this period, customers should not be able to make calls or top-up their accounts.
Vodafone had problems transferring customer accounts to the new billing system, and so stopped disconnecting inactive SIMs from its network. Consequently, they remained in a pre-disconnection state' for significantly longer than 24 hours. Customers were able to pay for top-ups at cash machines and via other electronic methods during this period, which should not have been possible.
Although receipts confirming the success of their top-ups' were issued to some of those customers, Vodafone did not credit any of the customers' accounts, or provide them with the services they had paid for. Nor did the credit show on customers' account balances. This practice lasted for 17 months, costing 10,452 pay-as-you-go customers in the region of £150,000. Vodafone staff failed properly to investigate and put things right.
Ofcom's investigation concluded that Vodafone had breached General Condition 23.2(a), which prohibits the mis-selling of mobile telephone services; and General Condition 11.1, which prohibits inaccurate billing.
Complaints handling investigationAll telecoms providers must have procedures in place that follow Ofcom's approved Code of Practice (PDF, 20.9 KB ) for complaints handling. The Code sets minimum standards covering the accessibility, transparency, and effectiveness of providers' complaints handling processes.
Ofcom's investigation found that Vodafone provided its frontline customer service staff with insufficient and ambiguous information on when to treat a customer's call as a complaint.
Vodafone's procedures also failed to ensure that complaints were escalated quickly enough, and that customers received written notification of their right to alternative dispute resolution (ADR) after eight weeks.
We found that Vodafone's flaws in its complaints handling processes did not comply with our Code of Practice, and so contravened General Condition 14.4.
ENDS
NOTES FOR EDITORS
Affected customers were those who paid to top up their mobile phone credit by Vodafone's E Top-Up methods i.e. at ATMs, by direct debit, E-pack purchase, E-top up (Swipe cards) and Mobile ATM top-ups.
Between D
Most recent headlines
17/02/2025
TVBEurope talks to the team who brought a piece of broadcasting history back to life on BBC Wales last night
By Jenny Priestley
Published: February 14, 2025 ...
17/02/2025
Eligible studios will receive the relief directly from their local authorities, with no need to submit a claim
By Matthew Corrigan
Published: February 17, 20...
17/02/2025
As DEI initiatives come under pressure in the USA, supporters of Rise, which promotes diversity in the media and entertainment sector, discuss the continuing im...
17/02/2025
EIB Global loan will partially fund SES's continued O3b mPOWER medium earth orbit (MEO) fleet expansion enabling additional capacity worldwide. O3b mPOWER s...
15/02/2025
At Nielsen, Business Resource Groups (BRGs) play a critical role in nurturing a ...
15/02/2025
Innovation to empower creativity: Explore the latest in Lightroom
Rob Christensen February 15, 2025
0 Comments
Whether you want to remove distracting ...
15/02/2025
Wisycom, a worldwide leader in RF technology and provider of wireless solutions, announces a new distribution agreement with EQUAPHON. An Argentinian profession...
15/02/2025
DPA Microphones, the leading manufacturer of high-quality microphone solutions, is pleased to welcome Nicholas Nick Mariano and Vincent Vince Divine to the ...
15/02/2025
Tuxera, a leading provider of quality-assured file systems and networking solutions, will showcase how Tuxera Fusion SMB enables unprecedented performance for m...
15/02/2025
Bitmovin's latest Video Developer Report indicates an increasing role of AI, the slow adoption of next-generation codecs, and continuing challenges when it ...
15/02/2025
When Michelin Enterprises set out to promote its prestigious Hotel Guide in the new Sleepless in the Kitchen , campaign, veteran German/Slovenian gaffer Robert...
15/02/2025
Formula E, the world's first all-electric racing series, revolutionizing motorsport with cutting-edge technology and a commitment to sustainability has sele...
15/02/2025
Agile Content, a global leader in TV and video technology solutions, announces its rebranding to AgileTV.
The transition to AgileTV stems from a commitment to ...
15/02/2025
Hiltron Communications will promote the latest additions to its range of satellite communication products, systems and supporting services at GovSatCom 2025. Th...
15/02/2025
Following the success of the original Airglow Booklight, DoPchoice debuts a new addition to their inflatable line the Float. This lightweight, inflatable, round...
15/02/2025
LAS VEGAS Marshall Electronics has announced that it will debut its newest camera controller, the RCP Plus, at the 2025 NAB Show at Booth N2649 between April 5 ...
15/02/2025
ATLANTA Gray Media has named Blake Sebo as the next general manager of KTUU and KYES, Gray's NBC and CBS affiliates in Anchorage, Alaska....
15/02/2025
KOKKEDAL, Denmark DPA Microphones will feature its new CORE+ technology for distortion-free microphone sound at the 2025 NAB Show, April 5-9, in Las Vegas....
15/02/2025
SWANSEA, U.K. QuickLink will launch StudioPro-NDI and StudioPro-3, two new models of its QuickLine StudioPro video production platform, at the 2025 NAB Show, Ap...
15/02/2025
Live From 2025 NBA All-Star Game Weekend: After 25 Years, Turner Sports All-In F...
15/02/2025
NASCAR Driver Cam on Max Embraces Cloud-Based Workflow for 2025 Season Chris Brown of WBD Sports says Mobii will play key part in delivering signals from the tr...
14/02/2025
Last month, we officially launched the Spotify Partner Program, a powerful new m...
14/02/2025
From an island off the coast of Lutruwita to the global stage in France SBS & ...
14/02/2025
The future of electro-optical/infrared (EO/IR) land systems is evolving so that ...
14/02/2025
Here are 5 reasons why you should attend ISE 2025
Discover more about Calrec: Learn more about Calrec's legacy of innovation in broadcast audio solutions ...
14/02/2025
World Radio Day: On the same wavelength
By Graham Murray, International Sales Manager at Calrec
To mark World Radio Day, Calrec's International Sales Ma...
14/02/2025
DALLAS and TYSONS, Va. Tegna has concluded a broadcast rights agreement that makes Tegna's KFAA in Dallas the exclusive local television partner of the Dall...
14/02/2025
Amazon's Prime Video has released a new app for Apple TV that the streamer said delivers an improved streaming experiences with faster scrolling, improved s...
14/02/2025
CLEVELAND Telos Alliance announced a software update for its Axia Quasar XR and SR line of audio-over-IP (AoIP) mixing consoles and will show the offering at th...
14/02/2025
Puget Systems Returns to HPA Tech Retreat 2025 with New Analysis Tools for Puge...
14/02/2025
Glass Animals: Tour of Earth Uses Blackmagic Live Production Workflow
Brie Clayton February 14, 2025
0 Comments
80six deploys Blackmagic URSA Broadcas...
14/02/2025
A dispute between Paramount and Youtube TV that would have pulled CBS stations and Paramount's cable channels from the streaming service has been temporaril...
14/02/2025
Colourist Deidre (Dee) McClelland details how she helped shape the distinct look and feel of whimsical Oscar-nominated stop-motion film, Memoir of a Snail
By C...
14/02/2025
BitFire said it intends to introduce forward-looking services that simplify the launch of live production workflows, and enhance real-time collaboration
By Jen...
14/02/2025
The claim by the liquidators is the latest twist in the ongoing saga of the companys collapse at the end of 2021
By Matthew Corrigan
Published: February 14, ...
14/02/2025
A carriage dispute between YouTube TV and Paramount could come to a head today (Feb. 13), with the virtual pay TV provider threatening to pull all of the progra...
14/02/2025
ENGLEWOOD CLIFFS, N.J. LG Electronics USA has opened a new in-house, state-of-the-art virtual production studio at its 360,000-square-foot North American headqu...
14/02/2025
NEW YORK In a bid to help local broadcasters find new ways of monetizing their content, the Coalition for Innovative Media Measurement (CIMM) and TVB have relea...
14/02/2025
WASHINGTON Three Democratic U.S. Senators have sent a stern letter blasting FCC Chair Brendan Carr for the weaponization of the agency for attacking broadcast...
14/02/2025
Years after launching the streaming service Apple TV+ in November of 2019, Apple has finally released a version of its steaming app for Android devices....
14/02/2025
FOOTHILL RANCH, Calif. Red Digital Cinema will make its V-RAPTOR [X] and KOMODO-X camera systems available with Nikon's premier Z Mount, providing filmmaker...
14/02/2025
DAYTONA, Fla. The Fox Sports production of this year's Daytona 500 will see the addition of a few new tech elements and the continued unfolding of the broad...
14/02/2025
Watch Bryson Battles Blind Audition on The Voice Get a Four-Chair Turn Michael Bubl said the Boston Conservatory at Berklee musical theater senior might have...
14/02/2025
2025 Daytona 500: FOX Sports Looks To Ride Super Bowl LIX Momentum Into NASCAR S...
14/02/2025
14 Feb 2025
VEON's Kyivstar and the Come Back Alive Foundation Raise USD 2....
14/02/2025
Max Renews THE PITT, Starring Noah Wyle, For A Second Season
Max
Warner Bros. Television Group
The Pitt
New Episodes Of The Medical Drama From John...
14/02/2025
This year, Technicolor proudly celebrates 110 years of shaping the magic of cinema pioneering color, visual effects, and innovation that bring unforgettable l...
14/02/2025
NBA All-Star: More Games, More Teams, More Music, More Sound From the Court Turner Sports' team will deploy familiar tech to capture all the audio By Dan D...
14/02/2025
LIV Golf Continues To Innovate With Drones, Data-Driven Graphics, and All-Access...
Vodafone fined £4.6 million for failing customers 26 October 2016 
