Commerce Commission files against Vodafone, alleges misleading 'Red Essentials' mobile plan

Wednesday 25th May 2016

The Commerce Commission has filed court proceedings against Vodafone New Zealand, claiming the country's biggest mobile phone operator misled customers on its 'Red Essentials' mobile plan in 2014 to the tune of $90,000.

The regulator says Vodafone didn't accurately apply a $10 discount to customers who signed up to the plan from its introduction through until December 2014, meaning misleading invoices were sent to about 15,000 customers, who were overcharged by about $90,000. Following the commission's investigation, Vodafone refunded about 98 percent of affected customers, the regulator said.

Businesses face fines of up to $200,000 per charge for breaching the Fair Trade Act and the courts can impose bigger penalties where more than one charge is laid.

In a separate statement, Vodafone said it made a mistake with that plan and apologised to affected customers. The mobile carrier said it had cooperated with the regulator throughout, but didn't address the court proceedings directly.

Customer operations director Kelly Moore said the company had identified what caused the error and fixed it.

In 2014, Vodafone paid $268,000 to customers to settle a breach of the Fair Trading Act for a broadband promotion between 2009 and 2011. Two years earlier, the company was fined $960,000 for misleading advertising of its wireless broadband coverage and a free airtime deal, and in 2011 it was fined $400,000 over promotions it ran between 2006 and 2009.

BusinessDesk.co.nz

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