ACMA threatens Vodafone with $250k fine over code breaches

Stuart Corner
Thursday, 22 December 2011 07:28

IT Policy - Regulation

The ACMA has told Vodafone that it must comply with the Telecommunications Consumer Protections Code (TCP Code, or face a possible court action that could result in a $250,000 fine.

The move follows breaches of the code by Vodafone in late 2010 and early 2011 during its much publicised 'Vodafail' period. The orders have been issued to two Vodafone companies: Vodafone Pty Limited and Vodafone Network Pty Limited.

ACMA chairman Chris Chapman, said: "Vodafone has made positive changes over the course of this year but, from this point on, if either Vodafone company fails to comply with the TCP Code, the ACMA can approach the Federal Court seeking civil penalties of up to $250,000."

He added: "These directions are intended to make sure Vodafone remains focussed on improving outcomes for its consumers by increasing the regulatory consequences of any further breach."

The ACMA says it found that Vodafone had: failed to classify and analyse complaints as required by the TCP Code; failed to provide timely customer information about network performance issues in late 2010; and had poor systems in place for protecting the privacy of customers' personal details prior to January 2011.

Vodafone responded by saying that it had already addressed all the issues identified in the ACMA's compliance notice. CEO Nigel Dews said: "Since the issues emerged in late 2010 everyone at Vodafone has been committed to delivering a better network and service experience.

"We have supported the ACMA throughout their thorough and lengthy assessment, and while we respect the ACMA's view of past events, we haven't waited for their report to tell us what we've needed to do."

In a statement Vodafone said that it had:

- expanded the network information available to customers by providing an online postcode checker for customers to check indoor and outdoor coverage and any planned and unplanned outages in their area;

- created a network status web page providing details of planned and unplanned outages by state for a higher level view;

- introduced a 'pin drop' feature enabling customer service representatives and retail staff to record where customers had complained of network issues;

- started providing proactive communication to customers letting them know when there are planned upgrades and changes to the network in their area.

Vodafone said it had also made changes to its complaints handling process to ensure that 'expressions of dissatisfaction' were identified as complaints and had taken action to strengthen data security.

These changes include: improved login identification and authentification processes; more frequent password resets; limiting approved access points for stores and dealers and more stringent monitoring and detection technologies.

The ACMA's response failed to satisfy telecom consumer body ACCAN, which said that it "reveals deep flaws in co-regulatory model'¦Current and ex Vodafone customers will be left shaking their heads today when they discover that, 12 months on, the telecommunications regulator has let the provider off virtually scot-free for the widespread network, complaint-handling problems that plagued Vodafone customers last summer."

Meanwhile, the Australian Communications Consumer Action Network (ACCAN) is not impressed.

ACCAN CEO, Teresa Corbin, said: "These 'directions' by the ACMA effectively mean that what was a voluntary industry code is now mandatory for Vodafone. There are no fines and no sanctions that the regulator can issue as a result of this investigation, despite its findings of four serious code breaches by Vodafone, including customer service representatives giving customers incorrect and inconsistent advice while experiencing widespread network problems, and failing to adequately identify and address systemic complaints."

Corbin added: "If [the ACMA] had the right regulatory tools and adequate funding then it could do more to monitor compliance of service providers and undertake more effective enforcement action'¦The ACMA's Vodafone investigation makes it clear that the regulator needs stronger enforcement powers and that an industry Code, governing vital telecommunication services, cannot be voluntary."

Following its 'Reconnecting The Customer Enquiry the ACMA gave the industry five months in which to develop a Telecommunications Consumer Protection Code to the ACMA's satisfaction. If it fails to do so, the ACMA will mandate standards.