Telephonics fined £184k for not allowing customers to leave

A Birmingham telecoms company has been fined almost £184,000 after an Ofcom investigation found it had stopped customers from switching to rivals.

Telephonics Integrated Telephony became only the second company ever to receive the maximum punishment – a fine of 10 per cent of the firm’s turnover – for breaching telecoms rules by not allowing customers to transfer to other providers.

The company is also being investigated by the regulator over separate complaints about slamming – where a phone contract is switched from one operator to another without the customer’s knowledge.

Ofcom said its decision to impose the maximum financial penalty reflects the serious nature of Telephonics’ contravention.

A spokesperson said: “There are rules that all communications providers have to stick to and Telephonics, on this occasion, when people had been saying ‘we want to move away’ they had not been letting them move.

“You should be able to change provider whenever you want to.”

Telephonics, which is based on Chester Road, Castle Bromwich, sells phone lines and other communication services to hundreds of businesses.

In a statement, Ofcom said its investigators found evidence that Telephonics had mis-used information it received to stop customers from being able to transfer away, and later failed to take steps to ensure they did not continue this behaviour.

The regulator said it had met managing director Nicholas Wood in July last year to inform him there had been “a significant number” of complaints about Telephonics’ conduct in relation to the transfer of customers.

It said complaints about the company ranged from victims of slamming or silent calls, to those who have been stung by additional charges or who have problems switching provider.

Ofcom wrote to Telephonics on August 14 last year requesting that Telephonics take immediate steps to ensure it complied with regulations and after the company did not respond to the letter complaints about the practice continued.

Ofcom has now ordered Telephonics to write to all customers from June 1 last year informing them of the penalty.

The company has also been told it must allow customers who have previously had their transfer orders cancelled by the firm without their consent to be allowed to switch away without any charge, subject to conditions.

It is under threat of further penalties unless it complies with the ruling.

The Ofcom spokesperson added: “For this kind of offence we have only ever fined one company the maximum 10 per cent before.

“Now we will make sure that they put the changes into place that we have asked for.”

Birmingham Post, 28th August 2009

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