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Ofcom Probe Direct Save Telecom Over Cancellations and Debt Recovery UPDATE2

Tuesday, January 16th, 2018 (10:53 am) - Score 4,005

The UK telecoms regulator, Ofcom, has launched a probe into budget phone and broadband ISP Direct Save Telecom in order to examine the provider’s approach to recovering debt from customers, including how they handle related service disconnections or migrations.

As part of this probe the regulator intends to examine DST’s compliance with their consumer protection rules, specifically General Conditions 13 (Non-Payment of Bills) and 22 (Service Migrations and Home-Moves) rules. Under certain circumstances ISPs can disconnect customers who haven’t paid their bills and they can even block a customer’s request to switch to another provider.

Ofcom Statement

Following consideration of information provided by DST in response to Ofcom’s initial enquiries, Ofcom has decided to open an investigation into the company’s compliance with GC 13 and GC 22.

GC 13 requires all CPs to, amongst other things, ensure that any measures taken to secure payment from customers or disconnect them following non-payment of bills are proportionate, not unduly discriminatory and give due warning to customers. CPs must also publish these on their websites.

‘Cancel Other’ is a consumer protection mechanism designed to ensure that customers are not switched to another provider without their permission. It should only be used by CPs for very specific reasons and only in certain circumstances.

Ofcom said their “investigation will examine whether there are reasonable grounds to believe that DST’s approach to debt management misuses the Cancel Other process and/or in other respects fails to comply with its obligations under GC 13 and GC 22.” The regulator now expects to gather further evidence until April 2018 and they will then update on their findings.

We have hailed DST for a comment and will report back if one arrives.

UPDATE 3:24pm

The CEO of DST, Stavros Tsolakis, has told ISPreview.co.uk: “Direct Save Telecom have and will be providing full support to Ofcom during this investigation. We remain committed to providing an excellent service with low prices, whilst continuing to remain compliant. Until Ofcom have finalised their investigation, we will not be making any further comments in this regard.”

UPDATE 21st May 2018

Ofcom has decided not to take any further action after DST made a number of changes to its debt management processes and practices intended to secure compliance with GC 13 and GC 22. In addition, as a result of the formal investigation, DST has also provided the following written assurances to Ofcom.

DST’s Assurances to Ofcom

* DST will make all necessary changes to its policies and procedures to ensure that it only uses Cancel Other in the circumstances permitted in the General Conditions. This includes ensuring that it does not use Cancel Other to prevent a customer in debt from switching to another provider (or to make the customer’s ability to switch conditional on resolution of a debt issue).

* DST will ensure that customers are aware about the consequences of continued non-payment before any actual suspension or interruption of service.

* DST will maintain an up-to-date published debt management policy on its website at all times and refer to these in its terms and conditions for consumers and business customers.

* DST will ensure that its staff are appropriately informed about these process changes, to ensure the assurances are operationalised.

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By Mark Jackson
Mark is a professional technology writer, IT consultant and computer engineer from Dorset (England), he also founded ISPreview in 1999 and enjoys analysing the latest telecoms and broadband developments. Find me on Twitter, , Facebook and Linkedin.
Leave a Comment
4 Responses
  1. TWKND says:

    They’ve disconnected me when they failed to change my direct debit details after I asked them to. The letter warning me of it arrived days after. Anything I can do?

  2. Lewis T says:

    Hi there – please contact us on 0800 027 3930 (Option 3). We would like to discuss this.

    Thanks

    Direct Save Telecom

  3. Claire says:

    Direct Save has instructed debt collection against me for a sum that has never been invoiced and is not owed. Debt collectors have threatened me with an adverse credit rating despite not being able to tell me what the amount is apparently for. Do I really have to go to court to sort this out?

  4. steven mc murray says:

    direct save have not provided me with a good broadband it keeps cutting of and i lose computer all my gadgets and tv at least 7 times a day SO I KEEP PHONING THEM AND THEY SAID WE WILL SEND A ENGINEER .AFTER2 ENGINEERS IN MY HOME Still got the same problem. then they charged me £135 for an engineer.Idid not ask for the engineer and nothing has changed with my problem 3 or 4 months of bad service and still not fixed I was told When i phone up and complaind about my bb they told me we csn see your bb keeps falling we will no charge you for this It did not happen.And now i want to leave to abetter provider as im disabled and i kneed bb all the time they say ive got to pay my contract i find this very bad

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