TalkTalk and Tiscali UK have been fined £3m by media regulator Ofcom after incorrectly billing customers for services they did not receive.
The fine follows an investigation by Ofcom into the two companies last July following over 1,000 complaints, where it was found that both companies has wrongly billed consumers for services they had not received, particularly customers who had closed their accounts.
Just over 62,000 cases were found between 1 January and 1 November 2010.
Both companies were given a deadline of 2 December 2010 to rectify their billing problems, with both taking ‘some important steps’ such as changing their customer records management systems. Despite this, they still incorrectly billed almost 3,000 consumers between 2 December and 4 March.
Both have now been handed a financial penalty to highlight the seriousness of the rule breach with over £2.5m having been repaid in refunds to affected customers and good will payments already.
Ofcom has the authority to fine companies in breach of telecoms rules up to 10% of their relevant turnover, but has issued both TalkTalk and Tiscali UK with a lower penalty, having taken action to attempt to remedy the problems.
The fine, payable to Ofcom, will be passed to HM Treasury.