Over 1,000 consumers had complained about incorrect billing
UK telecom regulator Ofcom has fined TalkTalk and its subsidiary Tiscali UK £3m after they incorrectly billed tens of thousands of consumers for services they had not received.
TalkTalk is required to pay the fine, which is payable to Ofcom and passed on to HM Treasury, within 30 days of receiving the penalty notification. TalkTalk acquired Tiscali UK in 2009.
Over 1,000 consumers had complained about this incorrect billing, following which Ofcom opened an investigation into TalkTalk and Tiscali UK in July 2010.
The telecom regulator found that both companies had wrongly issued bills to consumers for services they had not received, in particular to consumers who had closed their accounts.
Over 62,000 such cases have been reported between 1 January and 1 November 2010. Ofcom issued a legal notice to both companies in November 2010 to sort out their billing problems by a deadline of 2 December 2010.
However, they still incorrectly billed almost 3,000 consumers between 2 December 2010 and 4 March 2011, despite taking some important steps to comply with the rules.
Ofcom also asked TalkTalk and Tiscali UK to pay refunds to the affected customers. TalkTalk has paid over £2.5m in refunds and good will payments to over 65,000 affected consumers.