Broadband ISP Plusnet Fined £880,000 by Ofcom for Wrongful Billing

Internet provider Plusnet has today been hit by a fine of £880,000 after the national UK telecoms regulator ruled that they had incorrectly billed 1,025 ex-customers for landline and broadband services, which occurred between 26th May 2011 and 3rd September 2015.

The related customers had all previously cancelled their service, yet Plusnet continued to bill them and as a result the group was overcharged by more than £500,000 in total. We should point out that Plusnet voluntarily submitted itself for investigation after first discovering the issue last year “whilst undertaking a routine asset reconciliation exercise of its customer base.” As part of that process the ISP identified that some customers had been charged despite having no active telephone or broadband service.

Apparently Plusnet has made repeated attempts to refund all affected ex-customers by letter and by phone. So far the ISP has refunded 356 customers a total of £212,140, which included interest at a rate of 4% for each customer. Unfortunately they’ve not been able to contact everybody (many people will have moved home etc.) and so have donated the remaining funds to a dozen local charities.

Lindsey Fussell, Ofcom’s Consumer Group Director, said:

“There can be no margin for error, and no excuses, when it comes to billing customers correctly.

This fine should serve as a reminder to telecoms companies that they must adhere to Ofcom’s billing rules at all times, or face the consequences.”

A Plusnet Spokesperson told ISPreview.co.uk in Feb 2017 (here):

“We reported it to Ofcom and contacted all affected customers so we could arrange a full refund, before the investigation had begun. A number of new robust measures have been implemented to prevent this from happening again.”

Ofcom has given Plusnet 20 working days to pay the fine, which will be passed on to HM Treasury. The penalty incorporates a 20% reduction to reflect the ISP’s willingness to enter into a formal settlement and take full responsibility for the breach of the regulator’s billing rule.

We note that the investigation had originally set out to include a wider period from 7th March 2008 onwards but Ofcom was forced to revise this after realising that they had only gained the necessary legal enforcement powers in May 2011 (i.e. the earlier period wasn’t covered).

Ofcom’s Investigation
https://www.ofcom.org.uk/../all-closed-cases/cw_01178