Australian competition regulator ACCC has initiated legal action against one of the nation's largest ISPs TPG Internet for allegedly engaging in misleading conduct.
The ACCC has initiated proceedings in the Federal Court over TPG's practice of charging an A$20 “prepayment” to cover costs that might be incurred but are not included in their plan, such as overseas calls.
According to the regulator, TPG had represented this prepayment as a way to be used for excluded services before the customer cancelled their plan. But TPG failed to be explicit enough to consumers that it will retain at least A$10 of the fee when a customer cancels their plan, making it effectively a non-refunable fee.
The company also allegedly did not make clear that the prepayment is automatically topped up once the prepaid balance falls to A$10 or lower.
“A reasonable consumer would expect that this A$20 payment would be refunded if it was not used, but in fact it is non-refundable. It is unacceptable that TPG only disclose this forfeiture in fine print,” ACCC deputy chair Delia Rickard said.
“Since March 2013, the ACCC estimates that TPG is likely to have retained millions of dollars paid by consumers in prepayments that were forfeited.”
The ACCC is seeking to have TPG fined and ordered to pay compensation for consumers.