Mobile retailers must clean up their actsPhone watchdog clamps down on mobile misselling

17 September 2009

A mobile phone

Misleading and pressure selling of mobile phone services could soon become a thing of the past, if new rules that came into force yesterday prove a sufficient deterrent to less than scrupulous mobile retailers.

Under the rules, phone watchdog Ofcom has warned mobile phone service providers and retailers that they could face fines if they engage in 'dishonest, misleading or deceptive conduct'.

Ofcom has introduced these new rules following a big increase in the number of complaints about cashback schemes and other forms of misselling in the mobile market, which a voluntary code of practice by mobile operators did not significantly reduce. 

The Which? review of the best mobile provider reveals how the five mobile networks 3, O2, Orange, T-Mobile and Vodafone measure up to smaller competitors like Tesco Mobile and Virgin Mobile for customer satisfaction with pay-as-you-go and pay-monthly mobile contracts.

What is mobile misselling?

Mobile misselling can include being given fake or misleading information about contracts, tariffs or prices, being sold a cashback deal with near-impossible terms and conditions to meet in order to claim the cashback, or being given the wrong information about coverage and reception. 

Misselling can result in people being stuck in a long term contract which isn't right for them, whether because they can't get a mobile signal in their area or because the price they have to pay is much higher than they were originally told.

Keep your wits about you and you can get a great mobile deal that's perfect for you simply by shopping around online and on the high street. Use the Which? guide on how to choose a mobile phone tariff to pick the best and cheapest mobile deal for your needs, or take a look at the wide range of Which? Best Buy mobile handsets to suit every mobile need in the Which? mobile phone reviews.

Mobile cashback terms must be fair

The new rules are intended to protect you whether you have a problem directly with an operator or whether you've bought your mobile phone service from a third party retailer that 'resells' mobile phone services, such as Phones4U and online mobile phone retailers. The rules state that mobile phone service providers such as O2 and Vodafone must:

  • not missell mobile phone services
  • make sure the customer intends and is authorised to enter into a contract
  • make sure consumers get the information they need at the point of sale
  • make sure that the terms and conditions of cashback deals offered by third party retailers are not unduly restrictive
  • carry out certain due diligence checks in respect of third party retailers

Mobile service providers who breach the rules could be fined up to 10% of relevant turnover.

If you think you've been missold a mobile service, use the Which? guide to dealing with mobile phone problems to help you find a solution.

Mobile misselling must be stamped out

Ofcom says complaints have fallen from over 600 to fewer than 200 per month since it first announced plans to introduce the mandatory rules in March 2008, but it wants to stamp out misselling altogether. 

Which? mobile expert Ceri Stanaway says: 'We welcome the move by Ofcom as the voluntary code, while having some impact, was not serving consumers well enough.

'Ofcom has no direct power over third party mobile retailers, and given that many people buy their mobile services from such retailers it's good news that Ofcom's new rules make mobile operators responsible for ensuring the retailers they work with treat their customers fairly.

'We hope Ofcom continues to keep a close eye on the mobile retail market to make sure mobile operators and mobile retailers abide by the rules.'

Don't become a victim of pressure selling

It is unfortunately common for third party mobile retailers to call mobile customers around the time they are due a mobile phone upgrade in an attempt to drum up business. If you receive such a call, be very careful to clarify what the mobile retailer is offering and ask it to send you written details of the mobile deal before agreeing to anything. If in doubt, do not continue with the call. 

Under the new rules, third party retailers who cold-call mobile users to offer them a new contract must not mislead the potential customer that they are calling on behalf of a mobile network.

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