Alleging misleading conduct.
The ACCC has instituted proceedings in the Federal Court against TPG Internet (TPG) for engaging in misleading conduct about a $20 ‘prepayment’ made by consumers that also included unfair prepayment contract terms in some of the telco’s plans.
Customers signing up to a TPG plan had to pay $20 for a ‘prepayment’ to cover costs that might be incurred but are not included in their plan, such as overseas phone calls. From March 2013, TPG represented on its website that the prepayment of $20 could be used for excluded telecommunications services before the consumer cancelled their plan. However, the prepayment operated as a non-refundable fee and TPG retained at least $10 of the prepayment when a customer cancelled their plan.
“A reasonable consumer would expect that this $20 payment would be refunded if it was not used, but in fact it is non-refundable. It is unacceptable that TPG only disclosed this forfeiture in fine print,” ACCC deputy chair, Delia Rickard (pictured) said.
Since March 2013, the ACCC estimated that TPG is likely to have retained millions of dollars paid by consumers in prepayments that were forfeited, Rickard said.
The ACCC is alleging that TPG’s representations to customers about the forfeiture and automatic ‘top-up’ function are misleading. The ACCC is also alleging TPG’s standard contract term requiring forfeiture of the prepayment is unfair under Australian Consumer Law.
The ACCC is seeking penalties and compensation for consumers.