ISP direct debit scam uncovered by watchdog

The Australian Communications and Media Authority has slammed an Australian internet service provider for participating in a dodgy direct debit scam where money was unlawfully filtered out of customer accounts.

Late last week it was revealed that the ACMA issued a direction to internet service provider, Web Ace, after it was discovered to be in breach of the Telecommunications Consumer Protections Code.

According to the ACMA, Jason Kenneth McKay (trading as Web Ace) has been deducting money from customers’ credit card accounts without their authority. This money has proved difficult, if not impossible, for customers to recover.

Customers signing up with Web Ace often authorise bill payment through automatic direct debits from credit card accounts on the basis that the money deducted will cover agreed upon amounts for services.

What customers did not expect was that Web Ace would take money from their accounts at other times and for different amounts, without their prior knowledge or consent.

The ACMA outlined that under the code, a bill must be provided to customers before any funds are debited from an account, to give the customer an opportunity to view, query or dispute the bill.

“In issuing this direction, the ACMA has taken enforcement action to ensure that Web Ace’s customers will enjoy the same consumer protections afforded by the code as are available to customers of other telecommunications providers,” said Chris Chapman, chairman of the ACMA.

“The ACMA will use its regulatory powers whenever necessary to enforce compliance with codes registered under Part 6 of the Telecommunications Act 1997, as well as those obligations established by the legislation that governs the industry.”

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