Ofcom Fine UK ISP Onestream £35K for Aggressive Mis-selling UPDATE

Hampshire-based broadband ISP Onestream, which was established in 2016 and has launched a range of affordable ADSL2+ and FTTC based bundles, has today been fined £35,000 by Ofcom after the regulator found that they “took over the telephone services of more than a 100 people without their permission” (slamming).

Slamming is a mis-selling practice that can occur when naughty people or ISPs trigger a switch (migration) of your service to another provider, albeit without you ever having given confirmed consent. Ofcom’s existing migration rules (General Condition 7 – formerly GC22) are designed to protect against such abuse, but they’re not perfect and some cases still occur.

The regulator’s investigation, which began in January (here), found three-quarters of people slammed by Onestream were elderly or vulnerable. They also discovered that, in many cases, even when customers cancelled Onestream’s order to take over their landline telephone service, the company made repeated attempts to transfer them across regardless.

Overall a total of “at least” 113 people were affected by the provider’s actions, which occurred between 13th April 2018 and 25th January 2019.

Ofcom Statement

We have fined Onestream £35,000. The company has admitted its failings and agreed to settle the case. Onestream must also release affected customers from their contracts without charge, and refund those who had already switched and paid early termination fees.

Onestream has also written to all customers who switched to it as a result of a telesales call, to tell them they are entitled to exit their contract without being penalised, at any time, regardless of whether they were the subject of this investigation.

Ofcom expects the fine to be paid within 20 working days and after that it will be passed on to HM Treasury. The figure may seem small for such an offence, although it’s worth considering that Onestream itself is a very small ISP and the ruling will no doubt affect their reputation within the eyes of consumers.

The penalty also includes a 30% discount from the fine that Ofcom would otherwise have imposed, which is on account of Onestream’s admissions of liability and its agreement to enter into a settlement. “The penalty reflects a number of factors including the harm suffered by customers, the objective of deterrence as well as the seriousness of the contravention. We also took into account the recklessness with which Onestream acted by not having in place effective and compliant policies and procedures which led directly to the contravention,” said Ofcom.

The regulator has a long history of coming down hard on ISPs that are found to be engaged in mis-selling practices, like slamming, and as a result most providers are wise enough to avoid doing it. The last ISP to suffer as a result of such action was True Telecom, which at the end of 2017 was slapped with a £300,000 fine for mis-selling their landline telephone services to over 100 people (here); quite a bit more than Onestream.

UPDATE 1:37pm

We’ve had a comment from Onestream.

A Spokesperson for Onestream told ISPreview.co.uk:

“Over the past twelve months Onestream has worked extremely hard to make changes and introduce safeguards throughout the business, ensuring there can be no repetition of the mistakes that were made. Proven and respected industry professionals now hold key positions within the Onestream organisation who, working closely with independent consultants have revised all processes and implemented best practice to achieve positive change. All affected customers have been fully compensated, released from all and any contractual obligation and have received a full and unreserved apology.”