The Australian Federal Court has ordered Optus Internet to pay penalties of A$1.5 million for making misleading representations to customers about their transition from the Singtel-owned company’s HFC network to the National Broadband Network.
According to the Australian Competition and Consumer Commission, during the period from October 2015 to March 2017, Optus notified some 14,000 of its customers that their services would be cut off unless they agreed to move to the NBN.
However, under the terms of its contract, Optus could not force disconnection within the timeframe it claimed. In addition, Optus made misleading representations to customers that they had to sign up to Optus’ NBN services when they could have chosen any internet service provider.
Optus benefited by around A$750,000 as a result of the conduct, the ACCC said.
“Optus pressured customers by misrepresenting the time period in which services could be disconnected,” added ACCC Chairman Rod Sims. “Businesses should not make false representations which distort customers’ decision making. This is particularly important when many Australians are moving to the NBN for the first time.”
“It is illegal for businesses to mislead their customers and create a false impression through their communications,” continued Sims. “Today’s penalty serves as a warning to all businesses that such behaviour will be met with ACCC action.”
Since the ACCC investigation commenced, Optus has paid A$833,000 in compensation to affected customers for the disconnection of their services.