Peak Body Slams Telecoms as Optus Hit With $100M Fine
▼ Summary
– ACCAN has condemned the telecommunications industry following the Optus outage and called for an end to self-regulation.
– The Federal Court fined Optus $100 million for unconscionable sales conduct that harmed over 400 customers.
– ACCAN research shows low consumer trust, with 43% not trusting their provider to act in their best interest.
– The research also reveals ongoing poor sales practices, with 22% of consumers feeling pressured to buy more expensive contracts.
– ACCAN is advocating for urgent reform of the Telecommunications Act 1997 to prioritize consumer interests over industry profits.
A major Australian consumer advocacy group has launched a scathing critique of the nation’s telecommunications sector following a landmark court ruling against Optus. The Australian Communications Consumer Action Network (ACCAN) is demanding an end to industry self-regulation, arguing that recent events and ongoing research reveal systemic failures that continue to harm customers. This call for reform comes as the Federal Court imposes a $100 million penalty on Optus for unconscionable sales practices that negatively impacted hundreds of consumers.
Despite the substantial fine, ACCAN insists the underlying problems persist. The organization’s CEO, Carol Bennett, pointed out that senior management at Optus was aware of, or should have been aware of, the systemic issues that allowed such conduct to occur. She emphasized that a single punishment is insufficient to change an ingrained culture. Recent data from ACCAN’s Consumer Sentiment Tracker reveals that nearly a quarter of respondents felt pressured into buying a more expensive service plan than they needed, a trend that has continued even after regulatory action was taken against Optus.
The research paints a stark picture of eroding consumer confidence. A significant portion of Australians report a fundamental lack of trust in their service providers. The findings show that 43% of consumers do not trust their mobile or home internet provider to act in their best interest. Nearly half of all respondents lack faith that their provider will recommend the most suitable plan instead of the most costly one, and a similar percentage doubt their provider’s commitment to keeping prices low.
These trust issues are compounded by reports of persistent poor sales tactics. ACCAN’s data indicates that 21% of consumers felt pressured into expensive contracts, 30% found the actual network coverage differed from what was promised, and 42% experienced unexpected changes to their contract terms. Bennett stated that these figures will resonate with many Australians who have encountered aggressive sales approaches, unexpected bills, or services that fail to meet expectations.
The consumer network is using this evidence to bolster its case for a comprehensive overhaul of the governing legislation. ACCAN argues that the Telecommunications Act of 1997 is woefully outdated, as it still prioritizes industry self-regulation, an approach the group says has repeatedly failed to protect consumers. Bennett criticized the current system, where vital consumer protections are derived from a weak, industry-drafted code of practice. She contends that the data clearly shows customers are being pushed toward costly and unnecessary products because sales practices lack independent, rigorous oversight. The push for legislative reform is presented as an essential step to prioritize customer welfare over corporate profits.
(Source: ITWire Australia)