Product Promotion Network

Mobile phone billing scam hits Telstra clients

The West Australian on April 25, 2016, 12:30 am

Mobile Phone Billing Scam Hits Telstra Clients

Julie and Dave Davies have been slugged for premium phone services they don’t want and are difficult to cancel. Picture: Simon Santi

Thousands of Telstra customers are being caught up in a mobile phone billing scam, with some claiming to be charged thousands of dollars after simply clicking on a website or advertisement. Known as third-party billing, the process, which is legal but described as very, very dodgy by one telco insider, is understood to have netted Telstra millions in revenue despite thousands of customer complaints. The practice involves mobile customers unknowingly signing up to a subscription service by simply clicking on an advertisement or website that pops up on their mobile while users surf the internet.

Telstra, as well as Optus and Vodafone, have a commercial agreement with the subscription service providers, and provide them with a customer s mobile phone number. Subscription service providers, which usually offer products such as online games, are owned by companies registered all around the world. They charge the customer anywhere from ?6 to ?15 a week, with the charge appearing on a customer s monthly mobile bill.

Because the charge is automatically embedded into a bill, many customers do not notice it for months, with one victim claiming to have been billed ?4000 over two years without her knowledge. Others have told of drawn-out processes of trying to opt out of subscriptions while continually being billed. Although the practice has been going on in different formats for almost a decade, it has recently spiked in prominence, with the Telecommunications Industry Ombudsman reporting a 30 per cent increase in customer complaints on the issue last year, rising to just short of 2000.

All three major telco companies are involved in the third-party billing method, and it is used for legitimate methods such as buying online subscription services such as Spotify. But investigations byThe West Australian found Telstra was the only telco that still operated what is known as a one click opt-in method of acceptance for the subscriptions, where a customer can subscribe to a service simply by accidentally clicking on a website or advertising banner. Optus and Vodafone have a double click opt-in method, which is considered to offer more protection for customers because it asks them twice if they want to subscribe.

Telstra said it was now in discussions to introduce the double opt-in process. The issue is causing major problems for the telco, with a thread on Telstra s crowd support portal having hundreds of examples of customers claiming to have been ripped off by the method, with the charges ranging from ?6.60 to ?4000. One telco insider said”” the one-click process had netted Telstra multimillion-dollar windfalls, with the telco getting about 30 per cent of revenues from each subscription. Telstra declined to comment on specific revenue numbers.

Julie Davies and her husband Dave, of Sorrento, were among the thousands of customers caught up in the ruse. The couple received a text message in March saying they had subscribed to (German company) Jamster for ?30.76.

We have no idea how it happened, she said. After we saw it we made three phone calls. Three times they said they had unsubscribed us, and then we got another bill. And you get charged for calling and texting. She said Telstra eventually reimbursed them, though a Telstra employee wrote her an email and encouraged her to take the matter further because of the sheer number of complaints.

How can they do this? For us, it s fraud, Mrs Davies said.

Mobile Phone Billing Scam Hits Telstra Clients

Leave a Reply

Your email address will not be published. Required fields are marked *