The Australian Competition and Consumer Commission (ACCC) has initiated proceedings in the Federal Court against Optus Mobile Pty Ltd (Optus), accusing the telecommunications provider of alleged unconscionable conduct. The ACCC alleges that Optus contravened the Australian Consumer Law by selling telecommunications goods and services to hundreds of consumers that they often did not want or need. Furthermore, Optus is accused of pursuing consumers for debts resulting from these sales.

The ACCC alleges that a significant number of the affected consumers were vulnerable and/or disadvantaged, including those living with mental disabilities, diminished cognitive capacity, learning difficulties, financial dependency, unemployment, or limited financial and legal literacy. A significant number of the impacted consumers were First Nations Australians from regional and remote areas or people from culturally and linguistically diverse backgrounds.

ACCC Chair Gina Cass-Gottlieb stated, “We allege Optus’ conduct disproportionately impacted consumers experiencing vulnerability and/or disadvantage, and that these practices were incentivised by the commission-based remuneration for sales staff. In some cases, we allege Optus took steps to protect its own financial interests by clawing back commissions to sales staff but failed to remediate affected consumers.”

The ACCC alleges that Optus' conduct was incentivised by commission-based remuneration for sales staff. “This case concerns allegations of very serious conduct, as our case is that Optus sold goods to consumers experiencing vulnerability which they did not need, did not want and could not afford,” added Cass-Gottlieb.

The ACCC's case involves allegations that Optus acted unconscionably with about 429 consumers by engaging in inappropriate sales conduct and/or pursuing consumers for debts, including when it knew contracts were created fraudulently. The alleged conduct involves 363 consumers from two Optus Darwin stores, 42 consumers from the Optus Mount Isa store and 24 individual consumers from store locations across Australia.

“We also allege that Optus’ unconscionable conduct continued after management became aware of deficiencies in its systems that were being exploited by sales staff, and despite this, failed to implement fixes,” said Cass-Gottlieb.

The ACCC is seeking declarations and orders for penalties, non-party consumer redress, publication orders, a compliance program, and costs. “We are taking this action against Optus and seeking consumer redress in relation to the hundreds of consumers affected by this alleged unconscionable conduct,” Cass-Gottlieb stated.

“Many consumers suffered financial harm, incurring thousands of dollars of debt and non-financial harm, such as shame, fear, and emotional distress about the debts or being pursued by debt collectors,” she added. “Thankfully many consumers were supported by financial counsellors, carers and other advocates who gave their time and effort to support consumers to eventually seek resolution of Optus’ conduct.”

Optus is Australia’s second-largest telecommunications provider and a wholly-owned subsidiary of Singtel Optus Pty Ltd, a foreign-owned private company. “We will take appropriate enforcement action against breaches of the Australian Consumer Law, and we pay particular attention to conduct that disproportionately impacts consumers who are experiencing vulnerability or disadvantage,” concluded Cass-Gottlieb.