Giffgaff is today counting the cost of a billing scandal after it was found to have overcharged around 2.6 million customers to the tune of £2.9m.
The pricing error has seen Giffgaff landed with an outsize bill of its own from Ofcom which has fined the Telefonica-owned mobile operator £1.4m over its failings in the case – despite it refunding £2.1m of this cash to affected individuals, with the outstanding amount being donated to charity in cases where it was unable to identify the individuals concerned.
The fine could have been even higher but incorporated a 30% reduction on account of Giffgaff’s prompt response in settling the case and admitting its error by reporting the matter swiftly to the communications regulator.
Gaucho Rasmussen, Ofcom's director of investigations and enforcement, commented: "Getting bills right is a basic duty for every phone company. But Giffgaff made unacceptable mistakes, leaving millions of customers out of pocket. This fine should serve as a warning to all communications providers: if they get bills wrong, we'll step in to protect customers."
The mismatch between pricing and billed amounts arose among customers who purchased bundles of calls, texts and data using pre-paid credit who ended up paying over the odds.
Giffgaff has 20 working days to pay up and has been charged an additional £50,000 for failing to provide accurate information in response to two statutory requests made by Ofcom.
This isn't the first gaffe to afflict the mobile service over the past year, with an 'offensive and traumatising' Halloween ad also falling foul of authorities.