Optus says yes to $100m fine for dodgy sales tactics
Optus is on the hook for a $100 million fine after it pressured Aboriginal customers in remote regions into buying phone products they did not need or want.
The nation's second-biggest mobile operator has admitted to engaging in "unconscionable conduct" after the Australian Competition and Consumer Commission launched court action.
"In many instances, the consumers did not want or need, could not use or could not afford what they were sold, and in some cases consumers were pursued for debts resulting from these sales," the commission said on Wednesday.
It said many vulnerable customers were among the 400-plus victims across 16 stores between August 2019 and July 2023 pressured into buying phones.
The consumer watchdog specifically pointed the finger at Optus for deceiving Indigenous Australians in regional, remote and very remote areas.
Other customers who purchased unwanted products included people with diminished cognitive capacity, unemployed, having limited financial literacy or English not being a first language.
The watchdog and Optus will jointly ask the Federal Court to impose a total penalty of $100 million for breaching consumer law, but it is up to the court to decide the final fine.
The national peak communications consumer body said the fine would represent one of the largest consumer law penalties in Australian history.
"Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed in its behaviour preying on some of our most vulnerable communities and consumers, including Indigenous communities," Australian Communications Consumer Action Network chief executive Carol Bennett said.
Optus CEO Stephen Rue said the company's misconduct was inexcusable and unacceptable.
"I would like to sincerely apologise to all customers affected by the misconduct in some of our stores," Mr Rue said.
"Optus failed these customers, and the company should have acted more quickly when the misconduct was first reported."
Examples of the misconduct also included sales staff failing to point out whether Optus even had coverage in remote areas where they lived, failing to explain the financial obligations involved in contracts and misleading users into believing certain goods were free.
"The conduct, which included selling inappropriate, unwanted or unaffordable mobiles and phone plans to people who are vulnerable or experiencing disadvantage, is simply unacceptable," commission deputy chair Catriona Lowe said.
"Many of these consumers who were vulnerable or experiencing disadvantage also experienced significant financial harm."
Ms Lowe said the commission was particularly concerned Optus used debt collectors to pursue some customers after it had launched internal investigations into the sales conduct.
She noted the telco's actions caused "significant emotional distress and fear".
Financial counsellors said the case was further proof the telco sector needed stronger, enforceable regulation.
"Fines are important, but what we really need is structural reform and genuine cultural safety built into how businesses engage with First Nations communities," Financial Counselling Australia's First Nations policy director Lynda Edwards said.
13YARN 13 92 76
Lifeline 13 11 14
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Sydney Morning Herald
2 hours ago
- Sydney Morning Herald
The airline facing a double-whammy after Trump's bunker-busting
You've probably never heard of Mike Murphy – but he is the guy who was choking on his smashed avocado toast at about 9am on Sunday when US President Donald Trump dropped his massive ordnance penetrators on three Iran nuclear installations. Murphy runs the Australian arm of Bain, the majority owner of airline Virgin, which is set to list on the Australian market on Tuesday as the highest profile ASX entrant in years. Timing is everything for investing, and for Bain, the timing of the Virgin listing looks atrocious. Those investors who bought in pre-listing and who were looking to sell out immediately – for what are referred to as stag profits – may need to rethink. Airlines, in particular, are highly sensitive to any geopolitical conflict and they are even more vulnerable to those in oil-producing territories. Loading First, this is because the oil prices surges, and for airlines, fuel is one of the major costs. Second, international airline flights can be disrupted, redirected or in some cases, those that fly over affected areas will temporarily abandon services. Already, British Airways and Singapore Airlines have suspended a number of flights to the Gulf, affecting routes to key hubs such as Dubai, Doha and Bahrain, citing safety concerns and evolving airspace restrictions.
Perth Now
7 hours ago
- Perth Now
Expert's advice to motorists concerned that petrol prices will surge
Australian motorists worried about tensions in the Middle East affecting prices at the pump have been sent a clear message: 'Fill up now.' US President Donald Trump's administration carried out an attack on three nuclear sites in Iran on Saturday. It comes after Israel launched attacks on Iran earlier this month. Oil prices are expected to rise as a result of the escalation in conflict, however experts have spoken out to ease fears of immediate surges. 'It's really important for Australians today to understand that what we have seen again over the weekend, while it is another escalation above and beyond the escalation we saw the weekend before it, this is the Middle East,' NRMA spokesperson Peter Khoury said. 'Unfortunately, flare-ups are all too often and all too common.' The regional benchmark for oil in Australia, Tapis, is expected to increase in price by tonight, Khoury said. 'We don't know by how much,' he said. Based on what we're seeing out of the US, it could be $3 or $4 a barrel.' A possible way for Iran to retaliate against the US and Israel is to close off the Strait of Hormuz. The strait is a vital trade route used to transport 20 per cent of the world's crude oil, or about 20 million barrels per day. The Iranian parliament has backed closing the strait in response to the US attacks, though this must be approved by Iran's national security council. Oil prices could shoot above $100 per barrel if the strait is closed for a prolonged period, according to Goldman Sachs and consulting firm Rapidan Energy. JPMorgan analysts view the risk of Iran closing Hormuz as low because the US would view such a move as a declaration of war. US Secretary of State Marco Rubio on Sunday called on China to help prevent Iran from closing the strait. Rubio said it would be 'economic suicide' for Iran to close the strait because the Islamic Republic's oil exports also pass through the waterway. Currently, it remains open. Khoury said this is 'the most important thing'. 'We do not want Australians panicking,' he said. 'Yes, there is speculation about what could happen in the next days and weeks, but it is the Middle East and anything can happen. 'The other important thing for Australians to know tonight is that if you live in Sydney, Brisbane, Melbourne, Adelaide or Perth, fill up now.' A combination of prices being at or near the bottom of the cycle and turmoil in the Middle East mean now is the time to buy. 'Prices are either in the high $1.60s or in the low $1.70s,' Khoury said. 'That has everything to do with the domestic price cycles in those capital cities. 'The wholesale price in Australia has gone up about eight cents a litre since two Fridays ago when the escalation really flared up between Israel and Iran. 'It will go up again, is the expectation, based on the US decision to attack Iran over the weekend. 'But it's only gone up eight cents a litre in the last week and a bit. 'There's a lot of speculation about what could happen. It's really important that Australians focus on what is happening. 'And what is happening if you live in those bigger cities is that prices are pretty good.' NRMA spokesperson Peter Khoury has urged Australian motorists not to panic, but to fill up now for the cheapest petrol prices. Credit: 7NEWS Khoury advised motorists to check fuel prices near them and find the best deal. 'You can find some real bargains,' he said. 'On any given day, there can be huge gaps in the price of the cheapest service station and the price of the most expensive. 'In Sydney today, it's 70 cents a litre. 'Regardless of what's going on in the Middle East or anywhere else, and regardless of where we are in the price cycle, do your research, use the information that you have access to that motorists in other countries don't have. 'We fought hard to get that made public. It's there for you to use.' When asked when the conflict overseas will affect local prices, Khoury said it normally takes about seven to 10 days. Our service stations are yet to buy the more expensive barrels but when that happens, it will have a flow on effect. 'The NRMA will be monitoring those prices really carefully over the next days and weeks, because what we won't tolerate, obviously, is oil companies manipulating what's going on overseas to put their prices up any higher than they should go,' he said. Khoury also emphasised that even if the strait is closed, it would not create a similar crisis to those caused by other recent global conflicts. 'In 2022, Russia invaded Ukraine, Russia being the second-largest producer of oil,' he said. 'That created an initial shock.' 'Obviously, the world was going to enforce sanctions, and they did. That created an even bigger shock. 'At the same time that that happened, the COVID supply crisis that affected the whole world hit its peak. So we all came out of COVID lockdown at the same time. 'The whole world came out of lockdown at the same time. Demand for oil spiked. Supply could not keep up. So we had probably the worst supply issue or challenge in our lifetime. 'And then Russia invaded Ukraine. 'All of those things had to happen at the same time for Tapis, our regional oil price, to hit $133 a barrel. 'It's currently at $76 a barrel. 'So to get back to those record high prices that we saw back in 2022, you would need a catastrophe at that level to affect global supply. 'We're not there yet, clearly, based on oil prices and the wholesale price. 'And I think that's what we want Australians to focus on tonight.' -With NBC
ABC News
7 hours ago
- ABC News
NSW police officer's 'unconscious racism' behind decision to ignore Aboriginal man self-harming, report finds
Warning: This story contains details that some readers may find distressing. A senior NSW Police officer has been found guilty of serious misconduct, with his decisions driven by "unconscious racism" after he ignored an Aboriginal man self-harming while in custody a report by the independent watchdog has found. The Law Enforcement Conduct Commission (LECC) said that an Aboriginal man, referred to as CAE, had sustained a head injury while in custody at a regional police station with a significant Indigenous population, prompting a critical incident investigation. Four officers were on duty at the time of the incident, including the officer responsible for CAE, who had been working in the town for four years. Referred to as EAC1 in the report — the officer was described as the "most senior officer on duty" with 16 years experience in the police force, serving 10 as a senior constable. CAE was a local and a father, who had prior dealings with police over "criminal allegations". Officers were also aware of his serious mental health conditions, as well as his history of self-harm and "thoughts of suicide". On the night of the incident, over a period of three hours, the LECC ascertained through police documents, CCTV footage and two private examinations, that CAE banged his head against a metal bench, a door and a wall by around 11:30pm. It could be heard in other parts of the station, with EAC1 making "little attempt to stop it". "Other officers considered that an ambulance was needed, and this was raised with Officer EAC1. He did not request an ambulance," the report stated. CAE had by 1am developed a visible large lump on his temple. Officer EAC1 had however, decided it was still appropriate to transport CAE to a city police station, one-and-a-half hours away, in the back of a caged vehicle. The decision to avoid calling an ambulance, the LECC said, was due to EAC1's perceptions about the behaviour of the local Indigenous community. "Officer EAC1's decision not to call an ambulance was influenced by the fact that he thought CAE was 'bunging on' his self-harm in an attempt to be taken to hospital and not into correctional custody," the report detailed. "Officer EAC1's view was that Aboriginal people in the Regional Town community often attempted to manipulate the system in this way." In evidence given by EAC1 he accepted that when CAE was banging his head at 11:30pm, there was a need to call an ambulance. "Officer EAC1 expressed remorse when giving his evidence and said that he had learnt a lot by reflecting on his conduct," the report states. It went on to add that the officer "accepted that CAE wasn't 'gently' banging his head as per his entry on the Custody Management Record (CMR)". "Officer EAC1 accepted that when he saw CAE's head injury when taking custody photographs, he should have called an ambulance. "Officer EAC1 accepted he was required to call an ambulance from 11:30pm and when he saw CAE's physical condition when taking custody photographs at 1:30am". In its report, the state police watchdog made only one formal recommendation, suggesting that the limit for proceedings regarding breaches of Section 201 of the Police Act — which stipulates that it is an offence for officers to neglect or refuse to obey any lawful order or carry out any lawful duty — be extended to 12 months. Currently, the time limit for proceedings to begin is within six months The commission also encouraged NSW Police to "continue to explore options to provide face to face training on cultural awareness and mental health experiences".
