TalkTalk and Tiscali UK breached rules to protect consumers

02 November 2010

Ofcom has today instructed TalkTalk and Tiscali UK to stop breaching telecoms rules or they could face further enforcement action, including a possible financial penalty.

After receiving over 1,000 complaints this year alone, Ofcom found that TalkTalk and Tiscali UK have breached telecoms regulations by issuing bills to consumers for services that have not been provided.

Both companies issued bills for services consumers had cancelled.

Ofcom has issued TalkTalk and Tiscali UK - which are both part of TalkTalk Group - with a legally-binding Notification requiring them to comply with the rules, known as a 'General Condition', by 2 December 2010 or face further enforcement action.

Affected consumers

As part of the investigation, Ofcom considered complaints from affected consumers, as well as looking at Talk Talk's and Tiscali UK's customer records.

Some examples of consumers affected include:

Consumer A complained to Ofcom that she had switched her landline from TalkTalk to another provider in January 2010 but continued to receive bills. She told Ofcom that she tried to resolve the issue with TalkTalk, spending over an hour on the phone, but received no confirmation that it would stop sending her bills for a service she had cancelled. TalkTalk's customer records show that £109.77 was demanded from Consumer A for services she had cancelled.

Consumer B informed Ofcom that she cancelled her account with Tiscali UK in February 2006, but had received a bill from debt collectors for the cancelled service. Tiscali UK's customer records show that Consumer B made payments to Tiscali UK totalling £609.97 for services it had billed her for but not provided.

In May 2010, Consumer C complained to Ofcom that he had cancelled his broadband account with Tiscali UK in 2008 and yet he continued to receive bills two years later. Consumer C was contacted by a debt collection company saying he owed £353.99 to Tiscali UK.

The maximum penalty is a fine of 10 per cent of relevant turnover.

Consumer harm

The Notification also requires TalkTalk and Tiscali UK to take steps to remedy the harm they caused to consumers, which could include, but are not limited to: 

  • providing refunds to all consumers who were billed for cancelled services since 1 January 2010;
  • stopping debt collection action, and withdrawing from any legal proceedings (if started), against consumers and paying their reasonable legal costs; and
  • taking any necessary steps to repair credit ratings of affected consumers, such as notifying credit reference agencies where relevant.

Ofcom's Director of Consumer Affairs, Claudio Pollack said: 'Ofcom is determined to stand up for consumers and take action against companies that break the rules.

'Our investigation into TalkTalk and Tiscali UK found that they had billed customers for cancelled services; this is unacceptable which is why we have ordered them to clean up their act or face the consequences.'

Listen to Claudio Pollack discuss the investigation on the Radio 4 Today programme

TalkTalk Group has co-operated fully with Ofcom's investigation. Click here for more details about the investigation

Complaints process

If you have a problem with your communications provider, have a look at our video guide below on the complaints process.

It tells you what you need to do each step of the way and explains more about Alternative Dispute Resolution (ADR) schemes.

There are currently two ADR schemes - Otelo and CISAS - and they act as an independent middleman between the service provider and the customer when things go wrong.

Telecoms complaints

Although Ofcom does not handle individual disputes or complaints, you can register your experiences with us on certain issues.

This helps us to understand industry-wide problems, and can lead to new enforcement or policy work.

Click here to learn more

ADR schemes

If the ADR scheme agrees with the consumer's complaint it can order the communications provider to fix the problem and, if needed, pay compensation.

All communication providers must belong to one of these ADR schemes and you can use the Ofcom ADR checker to see which provider belongs to which scheme.

As well as the video guide, we also have a printed guide which sets out the complaints process.

Subtitled version of the video