Australia’s Optus Faces USD100M Fine Over Exploitative Sales

(MENAFN) Australia’s second-largest telecom firm, Optus Mobile, has consented to pay a hefty AUD 100 million (USD 64.9 million) penalty after admitting to unfair and exploitative sales practices, the Australian Competition and Consumer Commission (ACCC) announced Wednesday.

Following court action initiated in October, Optus, a Singtel subsidiary, accepted responsibility for engaging in unconscionable conduct by selling products to vulnerable consumers. The ACCC and Optus will jointly request the Federal Court to impose the substantial penalty for breaches of Australian consumer law.

The regulator revealed that between August 2019 and July 2023, Optus sales representatives sold phones and service contracts unfairly to over 400 customers at 16 stores nationwide. "In many instances, the consumers did not want or need, could not use or could not afford what they were sold, and in some cases, consumers were pursued for debts resulting from these sales," the ACCC stated.

The affected clientele predominantly included vulnerable groups such as Indigenous Australians from remote regions, unemployed individuals, and those whose first language was not English.

Optus conceded that its sales team exerted undue pressure on these consumers, neglected to explain crucial terms and conditions in an understandable way, and disregarded whether customers had network coverage in their home areas.

ACCC chair Catriona Lowe condemned the actions as "simply unacceptable." She emphasized the severe financial repercussions endured by many disadvantaged consumers, noting, "Many of these consumers who were vulnerable or experiencing disadvantage also experienced significant financial harm. They accrued thousands of dollars of unexpected debt and some were pursued by debt collectors, in some instances for years."

Echoing the regulator’s stance, Optus CEO Stephen Rue described the misconduct as "inexcusable and unacceptable."

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