Optus has issued a lengthy apology and says it has sacked relevant staff after the consumer watchdog took it to court over alleged unconscionable conduct towards vulnerable customers.
The Australian Competition and Consumer Commission (ACCC) this morning alleged the nation’s second-biggest telco acted improperly towards 429 customers, including by pressuring customers into buying services they didn’t need, didn’t want and couldn’t afford.
The ACCC said staff deliberately targeted vulnerable people, including people living with an intellectual disability.
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In a statement released hours after the allegations were made public, Optus interim CEO Michael Venter apologised for the misconduct.
“We sincerely apologise to all customers affected by this misconduct and for the distress caused,” he said.
“We deeply regret that in these instances we failed to meet the customer service standards that our customers deserve and should expect.
“The misconduct alleged by the ACCC is unacceptable, and completely out of step with our company values and we accept that we need to protect all customers, including those experiencing vulnerability, from this type of behaviour.”
The telco has sacked some of the staff who were involved in the misconduct.
”Optus does not tolerate employee behaviour which takes advantage of customers,” Venter said.
“We have taken disciplinary action (including terminations) against staff whom we determined were responsible for this misconduct involving vulnerable customers.”
Optus said it was providing refunds, waiving debts and allowing customers to keep the devices they were sold, but Venter said ”we regret that we did not remediate more quickly in some of these cases”.
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Staff allegedly targeted people with intellectual disabilities
In addition to pressuring customers into sales, Optus is also accused of pursuing customers for debts resulting from those services, including by using debt collectors, even though it knew they had been inappropriately or fraudulently created.
The ACCC says the majority of the customers exploited by the alleged conduct were vulnerable or disadvantaged: some live with a mental disability, diminished cognitive capacity or learning difficulties, others were financially dependent or unemployed, or had limited financial and legal literacy.
Many were Indigenous Australians from regional and remote areas.
“We allege Optus’ conduct disproportionately impacted consumers experiencing vulnerability and/or disadvantage, and that these practices were incentivised by the commission-based remuneration for sales staff,” ACCC chair Gina Cass-Gottlieb said.
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“We also allege that Optus’ unconscionable conduct continued after management became aware of deficiencies in its systems that were being exploited by sales staff, and despite this, failed to implement fixes.”
The consumer watchdog said one example of the alleged conduct involved a person with an intellectual disability which impacted their ability to speak and understand finance.
The person “went into an Optus store and was sold an expensive phone, a business phone contract under a false ABN, a new NBN internet plan and accessories, though their disability was evident to Optus staff,” the ACCC said.
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“The person did not want or need the majority of these items and was upset and embarrassed about the unwanted and expensive items they were sold.
“When the person’s representative went to the store to return the items, the Optus staff refused to cancel the contracts and it was only through the intervention of a financial counsellor that Optus cancelled the contracts.”
In another example, Cass-Gotlieb said staff encouraged a young woman with a disability to come into a store without her carer.
“Now, that is deliberate and targeted, to avoid the protections that she needs,” Cass-Gotlieb said.
“She is then sold multiple products, has debts, and there’s debt collection. Now, that is one example. That is targeted conduct… we are looking at quite specific deliberate conduct at both a sales level and a management level.”
The ACCC alleges Optus’ conduct impacted 363 customers at two Darwin stores and 42 from the Mount Isa store – in Optus’ words, “three licensee-operated” outlets.
There were 24 customers impacted at other locations across Australia.
“Many consumers suffered financial harm, incurring thousands of dollars of debt and non-financial harm, such as shame, fear, and emotional distress about the debts or being pursued by debt collectors,” Cass-Gottlieb said.
It said “nearly all” staff at the Darwin stores “manipulated credit checks, oversold and overpriced accessories, and sold consumers phones and plans they could not afford” at the encouragement of senior store management over a two-year period ending last June.
The ACCC is seeking a range of orders from the federal court, including penalties, costs and redress for customers.
Venter said Optus has cooperated with the ACCC during its investigation and will continue to do so.
”Over the last three years we have undertaken a major review of how we manage sales, especially to vulnerable customers,” he said.
“We are in the process of appointing a customer advocate in a new role to work alongside our partners, community groups, financial counsellors and our customer teams to focus specifically on improving our support for customers in need,” he added.
“Optus understands the vital role we play in ensuring vulnerable customers stay connected and we continue to work with external consumer bodies to develop programs to support customers in a position of vulnerability.”
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