BT fined for overcharging 118 calls from EE mobiles

Almost 6,000 customers were overcharged for making 118 calls within a three-month period, with around £10,000 being billed unnecessarily.

Ofcom considered the breach a serious one as elderly and vulnerable customers are more likely to make use of 118 calls.

BT received a 30% discount on their penalty due to admitting their failings and agreeing to settle.

Credit: Electric Egg/Shutterstock.com

Cap breach

BT's failure followed the implementation in April 2019 of a price cap for making 118 calls, designed by Ofcom to protect vulnerable customers from unfair bills.

Between April and June 2019, however, BT's subsidiary - EE mobile - failed to implement the cap and almost 6,000 customers were overcharged by around £42,000 for making 118 calls.

While BT were able to correct many bills before they were paid by EE customers, around £10,000 was overpaid. All the money has since been refunded to customers.

BT admitted liability for the error earlier this month, accepting Ofcom's analysis of the length and scope of the failure. That's reflected in the level of discount offered to BT for the settlement, despite the severity of the breach.

Vulnerable customers

Core to Ofcom's investigation was the impact on vulnerable customers, particularly the elderly who are more likely to make calls to 118 numbers and use directory enquiries in this way.

They also examined the system failures leading to the contravention and took into account EE's previously poor record of compliance with regulatory obligations.

For instance, EE were fined £6.3m in November 2018 for overcharging customers who wanted to leave their contracts early by miscalculating exit fees and failing to make the rules around Early Termination Charges (ETC) clear to customers.

Prior to that, they were fined £2.7 in 2017 for overcharging 40,000 roaming customers and £1m in 2015 for failing in their complaints handling processes.

So, Ofcom's fine of £245,000 on this occasion considers EE's history of poor compliance, despite the fact that BT only officially acquired EE in 2016.

Fairness for customers

Ofcom's strong words about this breach are no doubt influenced by their ongoing campaigns to ensure fairness in the communications sector, especially for vulnerable customers.

A five-point fairness framework unveiled in January explained how Ofcom judge whether customers are being treated fairly, and a key feature is who is being harmed through a company's actions, along with how extensive that harm is.

This sits alongside the regulatory obligations that companies have and under which BT have been fined for the behaviour of their subsidiary.

Back in June 2019, BT and EE were two of the signatories to Ofcom's Fairness for Customers commitments, and EE also agreed to reduce mobile prices for customers who have been out of contract for more than three months alongside pledges from other mobile operators.

Ultimately, Ofcom are minded to take any breach which impacts vulnerable customers more seriously, and this was reiterated recently when they fined the Post Office for breaching rules around relay services used by disabled customers.

The £175,000 fine was levied when up to 126 disabled customers per year were adversely impacted by failings between August 2013 and November 2018. Ofcom judged the case even more severely due to the Post Office being aware of the problem for over two years and failed to rectify it.