Telstra pays $24 million in penalties and refunds after charging customers for inactive internet services
Telstra has been hit with heavy fines and penalties after wrongly charging customers.
The Australian Communications and Media Authority (ACMA) confirmed this morning that the telco has paid a $3.01 million penalty and refunded over $17.7 million to thousands of customers after charging them for inactive internet services over an 11-year period.
Another $3.4 million will be required to be refunded by the end of the year.
ACMA’s investigation found that 6,532 customer – many of which were small businesses – were wrongly billed by Telstra between April 2012 and August 2023 at an average of $2,600.
“Telstra has a history of incorrectly billing customers and it’s just not good enough,” said ACMA chair, Nerida O’Loughlin.
“At a time when many small businesses are facing economic pressures, unaccounted costs can create very real stress and financial hardship.
“All telcos must have robust billing systems in place to ensure that consumers, including small businesses, are only paying for agreed and active services.”
According to ACMA, Telstra claimed that the billing issues were due to it failing to follow a series of steps in its ADSL internet service deactivation process. However, ACMA reports that the telco has addressed the issue within its systems.
In a statement given to Mumbrella this morning, Telstra’s global business services group executive, Dean Salter, said: “Getting something as important as billing wrong isn’t acceptable, and this is clearly not the experience we want to be providing our customers.
“These ADSL billing errors occurred because we didn’t follow the proper deactivation process, including when some customers migrated to the NBN, which resulted in some customers being charged for inactive services.
“We’ve reached out to our customers to explain what went wrong and what we’re doing to fix it, including refunding them for the incorrect charges with interest. We know our customers deserve better, which is why we reported the issue to ACMA and conducted our own extensive investigation. We have put new controls in place to prevent this issue from happening again, including monthly checks if ADSL services are being used by customers before they’re billed.
“We’ve let these customers down. We apologise for this, and it’s clear we need to do better.”
The news comes after Telstra was found to have overcharged over 10,000 customers almost $2.5 million over 12 years in 2020. Another investigation last year found that the organisation overcharged more than 11,000 customers around $1.7 million.
Meanwhile, just last week, Telstra was hit with a $300,000 fine for “repeat customer safety and privacy failures”.
