Firm fined £80,000 over nuisance phone calls

A Glasgow building restoration firm has been fined £80,000 for making nuisance phone calls, following an investigation by the information watchdog.
  
A Glasgow building restoration firm has been fined £80,000 for making nuisance phone calls, following an investigation by the information watchdog.
 
Xternal Property Renovations made more than 109,000 unlawful marketing calls. The case centred on calls made to people registered with Telephone Preference Service, which meant they had opted not to receive sales calls.
 
The Information Commissioner’s Office (ICO) said nuisance marketing would not be tolerated.
 
Example of complaints from people who had received calls included: “I get these calls from early in the morning until late at night. I’m disabled and I worry about these calls.” and “I was concerned about how this company got my details – particularly my name. My number is TPS-registered and has been ex-directory for more than 30 years.”
 
Ken Macdonald, of ICO regions, said: “Nuisance marketing, whether it’s by calls to people’s landline or mobile, or through spam texts, causes disruption, annoyance and, in the worst cases, serious upset. We issue fines like these to firms behind nuisance marketing to send a clear message that such action will not be tolerated.”
 
 

BT fined record £42m for late installations

BT will be fined £42m for a serious breach of Ofcom’s rules, after the company reduced compensation payments to other telecoms providers for late installations.
  
BT will be fined £42m for a serious breach of Ofcom’s rules, after the company reduced compensation payments to other telecoms providers for late installations.
 
The penalty is a result of an investigation by Ofcom into BT’s network arm, Openreach. The investigation found that, between January 2013 and December 2014, BT misused the terms of its contracts to reduce compensation payments owed to other telecoms providers for failing to deliver ‘Ethernet’ services on time.
 
Ethernet services are the most common type of ‘leased lines’ – dedicated, high-speed cables used by large businesses, and mobile and broadband providers, to transmit data. These lines also provide vital, high-capacity links for hospitals, schools and libraries.
 
Ofcom has taken enforcement action because BT breached rules that address the company’s ‘significant market power’. This market power comes from the fact that most telecoms companies rely on access to BT’s network to provide services such as broadband to their customers. Ofcom’s rules are therefore fundamental in ensuring BT does not act in a way that could harm competition and, ultimately, consumers and businesses.
 
Gaucho Rasmussen, Ofcom’s Investigations Director, said: “These high-speed lines are a vital part of this country’s digital backbone. Millions of people rely on BT’s network for the phone and broadband services they use every day. We found BT broke our rules by failing to pay other telecoms companies proper compensation when these services were not provided on time. The size of our fine reflects how important these rules are to protect competition and, ultimately, consumers and businesses. Our message is clear – we will not tolerate this sort of behaviour.”
 
BT is obliged, under Ofcom’s rules, to install Ethernet services to its wholesale customers (providers such as Vodafone and TalkTalk), in accordance with its contracts, and to make compensation payments for late delivery. BT’s contracts require it to deliver Ethernet services within 30 working days, or pay compensation to the company affected.
 
If BT encounters problems that require more time to resolve, in certain circumstances it can assume that a customer has agreed to an extension. But Ofcom found that BT did this retrospectively over a sustained period, to reduce the level of compensation it owed to telecoms providers. Not only did this harm other telecoms companies, but it was also likely to have harmed the UK businesses and consumers who rely on high quality, high-speed, broadband services every day.
 
Ofcom opened the investigation in November 2015. This happened shortly after Vodafone brought allegations to Ofcom that BT had misused its contractual terms through the late delivery of Ethernet services without Vodafone’s consent, and by failing to compensate the company for these delays.
 
As a result of these findings, Ofcom will impose a penalty of £42,000,000 on BT. The penalty incorporates a 30% reduction to reflect BT’s agreement to settle Ofcom’s investigation by admitting full liability, and to set up a scheme to compensate the telecoms providers that have been affected.
 
BT must compensate, within twelve months, all the telecoms providers who faced financial loss because of its conduct. We anticipate that BT’s customers will engage constructively in the compensation process.
 
BT will also be fined £300,000 for failing to provide information to Ofcom. Through this Ethernet investigation, Ofcom became aware that BT failed to provide accurate and complete information for the original dispute, the Business Connectivity Market Review 2016 and this investigation.
 
Ofcom takes any breach of our information gathering powers very seriously as such failures undermine the integrity of the regulatory regime. Any company that breaks these rules should expect similar consequences.
 
 

Plusnet fined £880,000 for billing former customers

Plusnet, a BT owned company, has today been fined £880,000 by Ofcom for continuing to bill more than a thousand ex-customers.
  
Plusnet, a BT owned company, has today been fined £880,000 by Ofcom for continuing to bill more than a thousand ex-customers.
  
The penalty is the result of an investigation, which found that the telecoms company broke a fundamental billing rule by continuing to charge a group of customers for landline or broadband, after they had cancelled their service.
 
Once a customer cancels his or her home phone or broadband service, providers’ billing systems must recognise that the line is ‘ceased’. In this case, an error in Plusnet’s billing system meant that cancelled lines were still recognised as ‘live’. As a result, 1,025 customers who had cancelled either their landline or broadband service continued to be billed, meaning they were overcharged by more than £500,000 in total.
 
Lindsey Fussell, Ofcom’s Consumer Group Director, said: “There can be no margin for error, and no excuses, when it comes to billing customers correctly. This fine should serve as a reminder to telecoms companies that they must adhere to Ofcom’s billing rules at all times, or face the consequences.”
 
Plusnet has made repeated attempts to refund all affected ex-customers by letter and by phone. It has refunded 356 customers a total of £212,140, which included interest at a rate of 4% for each customer. Plusnet has donated the remaining funds to a dozen local charities, in lieu of payments owed to customers whom it could not contact. Plusnet has also made clear to Ofcom the steps it has taken to prevent any future billing errors of this kind.
 
As a result of Plusnet’s failings, Ofcom has today imposed a penalty of £880,000. The fine, which must be paid to Ofcom within 20 working days, will be passed on to HM Treasury.
 
The penalty incorporates a 20% reduction to reflect Plusnet’s willingness to enter into a formal settlement, which will save public money and resources. As part of this settlement, Plusnet admits and takes full responsibility for the breach of Ofcom’s billing rule.
 
 

Compensation for landline and broadband customers when things go wrong

Ofcom is today proposing to require providers to pay automatic compensation – either a cash payment, or a credit on a bill – to customers who suffer from these kinds of poor service.
  
Ofcom is today proposing to require providers to pay automatic compensation – either a cash payment, or a credit on a bill – to customers who suffer from these kinds of poor service.
 
Customers would be entitled to automatic compensation, without having to go through a potentially lengthy and difficult claims process, whenever: their landline or broadband is not fixed quickly enough after it has stopped working; or
their new landline or broadband service is not up and running on the day promised; or an engineer doesn’t arrive for an appointment as scheduled.
 
Ofcom estimates that the plans would mean up to 2.6 million additional landline and broadband customers could receive up to £185m in new compensation payments each year.
 
Lindsey Fussell, Ofcom’s Consumer Group Director, said: “When a customer’s landline or broadband goes wrong, that is frustrating enough without having to fight tooth and nail to get fair compensation from the provider. So we’re proposing new rules to force providers to pay money back to customers automatically, whenever repairs or installations don’t happen on time, or when people wait in for an engineer who doesn’t turn up. This would mean customers are properly compensated, while providers will want to work harder to improve their service.”
  
Compensation payments would be set by Ofcom, and designed to reflect the degree of harm suffered by consumers. Here is how Ofcom’s automatic compensation scheme would work:
 
 
How Ofcom's automatic compensation scheme would work
 
 
Today’s proposals apply to fixed broadband and landline telephone services only. Ofcom analysis shows that mobile companies already make significant compensation payments to customers and we estimate that less than 1% of mobile customers lose service for more than 24 hours. However, they will continue to monitor this area.
 
While most consumers are generally satisfied with their telecoms services, a significant minority still experience problems. Ofcom analysis suggests that each year: there are 5.7 million cases of consumers experiencing a loss of their landline or broadband service; engineers failed to turn up for around 250,000 appointments; and around one in eight landline and broadband installations were delayed (12%), affecting more than 1.3 million people.
 
When they occur, these problems can leave customers unable to keep in touch with friends and family, or use the internet, while one in four people (26%) who experienced a missed appointment have taken a wasted day off work to wait at home for an engineer.
 
Compensation payments are currently given ad-hoc to only a minority of those suffering problems (in up to 15% of cases), and can fail to adequately reflect the harm caused.
 
 
Around one-third of small and medium-sized enterprises choose residential landline and broadband services and would also benefit from the compensation proposals. But Ofcom propose that all SMEs should benefit from clearer, more detailed information upfront about the service on offer – including whether they are entitled to compensation, and how much, when problems occur.
 
SMEs can negotiate bespoke terms and there are standard landline and broadband business contracts that provide service guarantees and compensation for a number of different problems, including loss of service. But their research found that around half of SMEs (49%) were uncertain of their rights when providers fell short.
 
Ofcom proposals for greater transparency should help SMEs to compare the service quality and compensation arrangements for different contracts, and choose the one that best meets the needs of their business.
 
A consultation on today’s proposals is open until 5 June 2017 at 5pm, and Ofcom will publish our decision statement around the end of the year.
 
In response to Ofcom’s plans, BT, Sky and Virgin Media have jointly put forward a draft proposal to introduce automatic compensation through a draft voluntary industry code of practice. At this stage, they do not consider that this proposal sufficiently meets our concerns, when quality of service falls short.
 
 
 
 
 

BT agrees to legal separation of Openreach

The biggest reform of Openreach in its history is set to conclude, after BT agreed to Ofcom’s requirements for the legal separation of its network division.
  
The biggest reform of Openreach in its history is set to conclude, after BT agreed to Ofcom’s requirements for the legal separation of its network division.
 
This means Openreach will become a distinct company with its own staff and management, together with its own strategy and a legal purpose to serve all of its customers equally. BT has agreed to all of the changes needed to address Ofcom’s competition concerns. As a result, Ofcom will no longer need to impose these changes through regulation. The reforms have been designed to begin this year.
 
To implement this agreement with the smallest possible effect on BT’s pension scheme, the existing Crown Guarantee would need to be maintained for Openreach staff who are members of BT’s pension scheme.
 
The new Openreach will have the greatest degree of independence from BT Group possible without incurring the delays and disruption – to industry, consumers and investment plans – associated with structural separation or the sell-off of Openreach to new shareholders. BT’s commitments, combined with regulation imposed by Ofcom through its regular market reviews, will form a comprehensive solution to problems in the market that Ofcom had identified.
 
How the new Openreach will work:
 
Openreach will become a distinct company. Openreach will be incorporated as a legally separate company within BT Group,with its own ‘Articles of Association’. Openreach – and its directors – will be legally required to make decisions in the interests of all Openreach’s customers, and to promote the success of the company.
 
The Openreach Board will run the company. The Openreach Board that BT has already established in recent weeks, which has a majority of directors independent of BT, will become the Board of the new company. It will be truly responsible for running Openreach, under a new governance agreement.
 
A separate strategy and control over budget allocation. Openreach will develop its own strategy and annual operating plans, within an overall budget set by BT Group.
 
Executives will be accountable to the new Board. Openreach’s Chief Executive will in future be appointed by, and accountable to, the Openreach Board. BT Group will be able to veto appointment of the Openreach CEO, but only on notification to Ofcom. The Openreach Chief Executive will then be responsible for other executive appointments, and will report to the Openreach Chair – with a secondary accountability to the Chief Executive of BT, limited to necessary legal, fiduciary or regulatory obligations.
 
Staff will work for Openreach. The new Openreach will directly employ all its 32,000 staff, who will be transferred across from BT. This will allow Openreach to develop its own distinct organisational culture.
 
Assets will be controlled by Openreach alone. Openreach will have control of those assets – such as the physical access network – required to deliver on its purpose. The Openreach Board will make decisions on building and maintaining these assets: BT will hand these powers to Openreach, while retaining a title of ownership.
 
Consultation and confidentiality for Openreach’s customers. Openreach will be obliged to consult formally with customers such as Sky, TalkTalk and Vodafone on large-scale investments. In future, there will be a ‘confidential’ phase during which customers can discuss ideas without this being disclosed to BT Group, as well as further protections for confidential customer information.
 
Distinct branding. BT will be removed from Openreach branding, to reflect these changes and the company’s greater independence.
 
The new model will be supported by careful, continual monitoring to ensure it is effective. As part of this, BT will provide Ofcom with additional transparency on the nature of interactions between the new Openreach and the rest of BT Group.
 
Sharon White, Ofcom Chief Executive, said: “This is a significant day for phone and broadband users. The new Openreach will be built to serve all its customers equally, working truly independently and taking investment decisions on behalf of the whole industry – not just BT. We welcome BT’s decision to make these reforms, which means they can be implemented much more quickly. We will carefully monitor how the new Openreach performs, while continuing our work to improve the quality of service offered by all telecoms companies.”
 
BT’s commitments also include reforms to how BT works in Northern Ireland, where Openreach does not operate. These will extend the benefits of the Openreach changes to BT Northern Ireland – including greater independence, confidentiality, and independent branding. BT Northern Ireland will also remain able to take account of specific local circumstances and opportunities.
 
Why Openreach needs reform: Ofcom announced plans last year, as part of its Digital Communications Review, to overhaul Openreach’s governance and strengthen its independence from BT. This followed Ofcom concerns that BT has retained control of Openreach’s decisions, while other telecoms companies have not been consulted sufficiently on investment plans that affect them.
  
Openreach reform is one part of Ofcom’s work to ensure that all providers meet the growing demands of customers. We are also finalising measures to ensure better value for customers who only take a landline; deliver automatic compensation for landline and broadband customers when things go wrong; and bring about faster fault repairs and installations by Openreach.
 
Next steps: BT has outlined its commitments in a formal notification to Ofcom.
 
Ofcom will shortly publish further detail on how today’s agreement addresses our competition concerns, together with proposals to release BT from its previous undertakings around Openreach once the new commitments are fully in place. At the same time, we will set out how we will monitor and enforce the new structure for Openreach.
 
 
 
 

TV licence fee to rise to £147 in April

The UK’s annual television licence fee is to rise to £147 from £145.50, the government has announced. 

 
The UK’s annual television licence fee is to rise to £147 from £145.50, the government has announced.
 
The increase, which will come into effect on 1 April, marks the the first rise in the licence fee since 2010. At the time, the coalition government announced the fee would be frozen at £145.50 until 31 March 2017.
 
The licence fee covers all BBC services and contributes to the costs of rolling out broadband to the UK population. It also helps to fund the Welsh Language TV channel S4C and local TV channels. The Government is responsible for setting the level of the licence fee, and last year announced that it would rise in line with inflation for five years from 1 April 2017.
 
Licence fee payers will receive a payment plan or a reminder reflecting the new amount when their licence is next due for renewal, the BBC said in a statement. Those buying or renewing a licence after 1 April will pay the new fee.
 
Those already buying a licence on an instalment scheme which started before 1 April will continue to make payments totalling £145.50 until their licence comes up for renewal.
 
The announcement comes two days after BBC director general Tony Hall ordered an investigation into reports TV licence fee collectors targeted vulnerable people, spurred on by an aggressive incentive scheme.
 
 

New drivers caught using phones to lose licence

New drivers face losing their licence if they use their phones at the wheel under tough measures coming into force today.
  
New drivers face losing their licence if they use their phones at the wheel under tough measures coming into force today.
 
Motorists using a phone while driving will receive 6 points on their licence and a £200 fine – up from the previous 3 points and £100 penalty. Motorists caught using their mobile twice or accruing 12 points on their licence will face magistrates’ court, being disqualified and fines of up to £1,000. New drivers, within 2 years of passing their test, risk having their licence revoked and lorry or bus drivers can be suspended if caught.
 
Transport Secretary Chris Grayling said: ‘Our message is simple and clear: do not get distracted by your mobile phone while driving. It may seem innocent, but holding and using your phone at the wheel risks serious injury and even death to yourself and other road users. Doubling penalties will act as a strong deterrent to motorists tempted to pick up their phone while driving and will also mean repeat offenders could find themselves banned from our roads if they are caught twice. Everyone has a part to play in encouraging their family and friends not to use their phones while driving – it is as inexcusable as drink driving.’
 
Police forces across the country will be taking part in a week’s enforcement from 1 to 7 March. This will see extra patrols and an increased focus on cracking down on people using their phones while driving. About 3,600 drivers were handed penalties in the last co-ordinated enforcement week from 23 to 29 January this year.
 
The government has launched a powerful and thought-provoking THINK! campaign to warn drivers of the new penalties and the dangers of using mobiles while driving. The campaign will see adverts on billboards, radio and social media as well as a hard-hitting video in cinemas, which was developed in partnership with The AA Charity Trust. Stickers and other in-car merchandise that encourage motorists to put their phone away and out of reach while driving will be distributed through partnerships with driving schools and car rental companies.
 
Britain has some of the safest roads in the world but the government is determined to make them safer. The Department for Transport announced in 2015 it was exploring whether to increase the penalties for using a mobile phone while driving. This received almost unanimous support during last year’s consultation. The Ministry of Justice has recently finished a consultation on increasing the maximum sentence for causing death by dangerous driving from 14 years to life imprisonment in an additional crackdown on reckless drivers.
 
Chief Constable Suzette Davenport, National Police Chiefs’ Council roads policing lead, said: ‘ These new penalties reflect the seriousness of the offence and will strengthen the deterrent against using a mobile phone at the wheel. We need people to understand that this is not a minor offence that they can get away with. Across this week officers will continue to use innovative and intelligence-led tactics to catch and penalise people who are driving while distracted by a mobile phone. However, this is an attitudinal problem that we cannot simply enforce away by putting more officers on the roads. This issue has to begin with personal responsibility by drivers. We know that people are more likely to report other drivers using a phone than to view themselves as guilty of it. That has to change.’
 
Tougher penalties are a step in the right direction, but police forces and partners are working this week to make it socially unacceptable to use a mobile phone at the wheel. It’s about more than what you might have to pay as a penalty – you could hurt or kill an innocent person on the roads by checking a text or taking a call.
 
Don’t do it – and don’t let others take the risk either.
 
Edmund King, president of the AA, said: ‘ Too many drivers are addicted to their phones. Half of young drivers can’t bear to turn them off in the car. If they don’t switch off their phones they could lose their licence with the new 6 penalty points. We need to break this addiction and the best way is for drivers to go cold turkey – turn off the phone and put it in the glove box. We are delighted THINK! will be supporting our radical new advert and believe it will begin to make text driving as socially unacceptable as drink driving.’
 
RAC road safety spokesman Pete Williams said: ‘ Our latest report on motoring highlighted that the use of handheld mobile phones is at epidemic proportions and sadly the attitudes of many drivers have relaxed towards this illegal and dangerous activity. The new tougher penalties will therefore be welcomed by law-abiding motorists as a better deterrent. The change in the law is one important step in helping make using a handheld phone at the wheel as socially unacceptable as drink-driving. The fact that it is joined by a new high profile THINK! campaign which will also focus on the dangers of using a handheld phone when driving, targeted enforcement by the police to let offenders know they will be caught and the RAC’s BePhoneSmart.uk ‘make a promise’ website, means there is now real momentum in getting drivers to change their behaviour for good.’
 
The new penalties come into force in England, Scotland and Wales. Members of the public can report repeat offenders to Crimestoppers, anonymously, on 0800 555 111 and information will be passed on to police forces.

Calls for police to seize phones used illegally by drivers

Police could be given the power to seize mobile phones being illegally used by motorists, the Police Federation roads policing lead suggested.
  
Police could be given the power to seize mobile phones being illegally used by motorists, the Police Federation roads policing lead suggested.
 
Constable Jayne Willetts said the measure could act as a deterrent. “As technology is rapidly progressing, I fear our legislation is already behind the times,” she said. “Is the seizure of mobile phones or their Sim cards – along with an education system – the way forward, combined with fines? I don’t know, but it’s a question worth asking.”
 
It comes as figures reveal a record number of drivers were caught during a week-long police crackdown on illegal mobile phone use behind the wheel. Some 7,966 fixed penalty notices were handed out during a week-long campaign in November – the highest figure yet for a seven-day National Police Chiefs’ Council (NPCC) crackdown on “distraction driving”. The totals for the three previous initiatives were 2,690 in May 2015, 2,276 in September 2015 and 2,323 in May 2016.
 
Steve Gooding, director of motoring research charity the RAC Foundation, said a “blunt and brutal” measure may be necessary to tackle the issue. “It would be a massive step to give police the power to mete out summary justice in this way. But with far too many people still flouting the law maybe it will take something as blunt and brutal as, ‘you use it, you lose it’, to get the message across.”
 
Transport Minister Andrew Jones told the roads policing conference in Hinckley, Leicestershire, he wants to make using a phone behind the wheel “as socially unacceptable as drink-driving”.
 
Ministers have already said they want to double the punishment for motorists caught using a handheld phone while driving to a six point penalty and a minimum fine of £200. Those convicted of causing death by dangerous driving or careless driving under the influence of alcohol or drugs could also a face a lifetime in jail under the government proposals.
 
 

Thousands of drivers caught in mobile phone crackdown

Almost 8,000 drivers were caught using a mobile phone behind the wheel during a week-long crackdown by police.
  
Almost 8,000 drivers were caught using a mobile phone behind the wheel during a week-long crackdown by police.
 
Officers in England, Wales and Northern Ireland issued more than 40 fines an hour during the campaign in November. They also issued 68 court summonses, delivered hundreds of verbal warnings and identified 117 other distraction offences such as eating while driving. Police chiefs said the results were “encouraging” and another week-long campaign was to begin from Monday.
 
It is illegal to use a handheld phone while driving, with those falling foul of the rules facing penalty points and a fine. Calls to prevent drivers using phones intensified last year in the wake of several high-profile cases and research indicating that it was widespread. In October, lorry driver Tomasz Kroker, who killed a mother and three children while distracted by his phone, was jailed for 10 years.
 
Previous crackdowns saw 2,690 fines issued in May 2015, 2,276 in September 2015 and 2,323 in May last year. However, the National Police Chiefs’ Council (NPCC) said more forces – 36 in total – had been involved in the latest drive so results were not directly comparable.
 
Suzette Davenport, the NPCC’s lead for roads policing, said the figures “show how effective new tactics and innovative approaches can be”.
 
“Forces will be working to make driving distracted as socially unacceptable as drink-driving through enforcing strong deterrents and powerful messages to make people think twice about their driving habits,” she added. “Officers will continue to use intelligence-led tactics to target police activity and resources and catch repeat offenders.”
 
The Department for Transport announced plans last year to double the punishment for using a mobile phone while driving. Under new rules expected to be set this year, drivers could face fines of £200 and six penalty points. This comes alongside pressure by ministers calling for motorists who cause death while on a mobile phone to face tougher sentences.
 
 

EE mobile firm fined £2.7m for overcharging customers

Mobile operator EE has been fined £2.7m by the telecoms regulator, Ofcom, for overcharging tens of thousands of customers.
  
Mobile operator EE has been fined £2.7m by the telecoms regulator, Ofcom, for overcharging tens of thousands of customers.
 
The watchdog found that the UK’s biggest mobile network broke a billing rule on two occasions. Users who called its 150 customer services number while roaming within the EU were incorrectly charged as if they had called the US. That meant customers were charged £1.20 a minute, rather than 19p. As a result, more than 32,145 customers were overcharged a total of £245,000.
 
Despite calls or texts to the 150 number from within the EU becoming free from 18 November 2015, EE continued to bill more than 7,600 customers until 11 January 2016 who were overcharged £2,203.
 
Lindsey Fussell, Ofcom’s consumer group director, said: “We all rely on big companies to get the most basic things right, and that includes charging the right bills… we uncovered a catalogue of errors.”
 
The fine will go to the Treasury. Asked whether fining companies worked, Ms Fussell said: “We think that it’s a significant fine and that they are a good deterrent.”
 
EE said it accepted the findings and apologised unreservedly to customers affected. Most customers have been refunded, although EE could not identify at least 6,900 who were more than £60,000 out of pocket. EE has donated about £62,000 to charity in lieu of this sum, but Ofcom has ordered the company to make further attempts to trace and refund every customer who was overcharged.
 
In October, Ofcom fined Vodafone a record £4.6m for “serious” breaches of consumer protection rules. The regulator found the mobile operator had misled more than 10,000 pay-as-you-go customers, charging them for top-up credit but “providing nothing in return”, and had broken the rules on handling customer complaints.