Australian Mobile Phone Provider Sent 1000s of Fake Debt Collection Letters 82
Bismillah writes "Excite Mobile in South Australia also set up a fake debt collection agency, and a fictional complaints body for late-paying customers. The company sent fake debt collection letters to 1074 customers, even going so far as threatening to confiscate the toys of their customers' kids if they didn't pay up. From the article: 'South Australian mobile phone provider Excite Mobile has been found guilty of false, misleading and unconscionable conduct by the Federal Court after the ACCC took action against the company for faking a debt collection agency, creating a fictional complaints body, and misrepresenting scope of mobile coverage.'"
Re:Verizon (Score:5, Informative)
And you thought Verizon was bad...
Generally our telco's aren't this bad.
Excite Mobile are an MVNO (Mobile Virtual Network Operator) who dont own any infrastructure themselves. Their business model depends on being cheaper than the big 3 (Telstra, Vodafone and Optus) which often leads to having to use questionable business practices to stay in the black... Which is what happened here.
What isn't wrong, is that they sent letters of demand to late paying customers. They had every right to do this, even to use a debt collection agency (after a reasonable time) to recoup the loss. This is fine.
What they did wrong was to set up a fake debt collection agency (deceive customers) and send out threats to confiscate property that did not legally belong to them. Only a court order can order a debtor to hand over their own property to pay a debt and the court does not do this readily.
The second thing they did wrong was to set up another fake company, this time a complaint handling service that had an official sounding name, "Telecommunications Industry Complaints" that was internal to Excite Mobile which again deceived customers. What makes this particularly bad is that "Telecommunications Industry Complaints" sounds very similar to the official government body for regulating the telecommunications industry, the "Telecommunications Industry Ombudsman" who deals with high level complaints about telco's and has real power to hand out fines. So it was a deliberate attempt to mislead customers that an authoritative body was dealing with their complaints when it was not and an attempt to prevent customers from contacting the ombudsman (by confusing them between "complaints" and "ombudsman").
What is good here, is that Excite Mobile was caught and is being punished.