O2 fined £10.5 million for overcharging customers

O2 has been fined £10.5 million by Ofcom for overcharging 250,000 customers due to a technical billing error.

An investigation by the regulator found that, between 2011 and 2019, O2’s systems miscalculated the final bills for pay-monthly mobile customers, resulting in many being billed twice for the same charges.

More than 250,000 customers were affected by the issue, with the telecoms firm overcharging a total of £40.7 million.

However, around 140,000 actually paid the extra charges, in a total of £2.4 million.

According to Ofcom, O2 had been aware of the problems with its billing processes since 2011, but continued to overcharge customers when attempts to resolve the issue were unsuccessful.

O2 said that it is “disappointed by this technical error” and offered an apology to the “customers impacted”.

“We identified the issue ourselves and notified our industry billing auditor. We have also taken proactive steps to refund all impacted customers for the extra charges they paid, plus an additional 4%,” it added.

The company also emphasised that “the vast majority of funds reported were not overpaid”.

“Only 6% [out of the £40.7 million in overcharges]  - £2.4m - relates to money that was overpaid by customers,” it said.

Commenting on the findings, Ofcom’s enforcement director Gaucho Rasmussen said that “mobile customers trust their provider to bill them correctly and fix any errors as quickly as possible”.

“But these billing issues continued for a number of years without sufficient action from O2, and thousands of customers were overcharged as a result. This a serious breach of our rules and this fine is a reminder that we will step in if we see companies failing to protect their customers. O2 has refunded the customers who were affected, and we are satisfied the company has taken action to prevent this happening again,” he added.

O2’s £10.5 million fine from Ofcom comes weeks after BT was accused of overcharging its elderly customers for eight years in a £600 million class-action lawsuit. According to the claim, the company only agreed to lower its landline prices by £7 per month following a 2017 review by Ofcom.