Record penalty against Optus sends clear message to telco sector

Financial Counselling Australia welcomes the $100 million record penalty against Optus for unconscionable conduct. The penalty sends a strong message to the telecommunications industry: mis-selling to vulnerable customers will not be tolerated.

For some time, financial counsellors have been raising the alarm about the harm caused by Optus’ mis-selling products to some of the most vulnerable people in our community. People affected include people with intellectual disability, cognitive impairment, or low financial confidence. Many affected were First Nations consumers living in remote areas with no mobile coverage.

This misconduct was the result of corporate arrogance, a lack of oversight, and business models that failed to prioritise the protection of vulnerable customers. Sales commissions at franchised Optus stores drove predatory practices, while the company’s lack of compliance controls allowed them to continue unchecked.

This is not the first time a major telco has been fined for this sort of conduct. Optus knew the risks. It did not address them.

It is appropriate that the penalty for this unconscionable conduct would be the largest ever imposed on the sector. We commend the action taken by the ACCC, including a remediation program that aims to bring justice to those who were so callously ripped off.

Optus has committed to working with the financial counselling sector as part of this process, and we look forward to that constructive engagement to ensure that those affected are treated fairly.

More broadly, this case is yet another example of why the telco sector needs stronger, enforceable regulation. Self-regulation via the current Telecommunications Consumer Protections Code is clearly not working. The rules need to be tightened, oversight improved, and enforcement strengthened to ensure that all consumers are properly protected.

Quotes

Peter Gartlan, co -CEO of Financial Counselling Australia

“This case is deeply disappointing. The financial counselling sector has been raising concerns about Optus’ conduct for years. It’s unacceptable that it took ACCC action for Optus to take its responsibility to vulnerable customers seriously.”

“We welcome the ACCC, once again, for stepping in to hold a major telco to account. This kind of behaviour causes real harm and should never have been allowed to go unchecked.”

Lynda Edwards, Director of First Nations Policy and Campaigns at Financial Counselling Australia

“Financial counsellors and capability workers see the impacts of this kind of conduct every day in our communities,”

“People were sold services they didn’t ask for and couldn’t use, in places where there was no coverage. It’s yet another example of systems failing First Nations people. Fines are important, but what we really need is structural reform and genuine cultural safety built into how businesses engage with First Nations communities.”