Optus to pay $6.4 mn in penalties for false claims about internet

Australia’s Federal Court has asked the Optus Group, the second largest telecom operator with 30 percent market share, to pay $6.4 million in penalties for making misleading claims about home internet disconnections to consumers.
Optus on 24 May 2018 emailed 138,988 of its mobile customers claiming their existing home broadband services, provided by Optus’ competitors, would be disconnected very soon. The email encouraged the customers to change to Optus NBN Broadband, telling them to make the switch, before it’s too late. Optus has more than 1.1 million broadband customers.

The Federal Court found that this statement was misleading or deceptive because the customers who received the email were not facing immediate disconnection of their existing broadband services.

“As the NBN rollout nears completion, consumers around Australia are making decisions about whether and when to move onto the NBN, and what services are best for them,” ACCC Chair Rod Sims said.

“We took this case against Optus because we were concerned its emails created a false sense of urgency for consumers and may have discouraged them from shopping around for the best deal available,” Rod Sims said.

The ACCC started proceedings against Optus on 24 June 2019. This is the second time in two years that the Federal Court has ordered Optus to pay significant penalties for misleading consumers about the need to acquire NBN services following ACCC action.

In the last 10 years the ACCC has instituted proceedings against Optus five times, accepted five court enforceable undertakings from Optus and issued Optus with 29 infringement notices, ACCC said in a statement on Monday.