Vodafone (LON:VOD) has been fined £4.6 million by Ofcom for “serious and sustained” breaches of consumer protection rules. The penalty is largest issued by the telecoms regulator to date.
Vodafone’s share price has edged lower today, having lost 0.66 percent to 224.50p as of 13:56 BST. The stock is outperforming the benchmark FTSE 100 index, which is currently 1.17 percent down at 6,935.43 points. The company’s shares have risen just under four percent over the past year, and are up by almost two percent in the year-to-date.
Ofcom said in a statement today that Vodafone would be fined £4.6 million after two investigations had “uncovered mis-selling, inaccurate billing and poor complaints handling procedures”. One of the inquiries found that more than 10,000 pay-as-you-go customers lost out when the telecoms company failed to credit their accounts properly and then failed to deal with the issue quickly enough. The other probe found that the company had failed to comply with the watchdog’s rules on handling complaints, with its staff being too slow to react to customer issues and providing ambiguous information.
In response to Ofcom's ruling, Vodafone said: “We deeply regret these system and process failures. We are completely focused on serving our customers: everyone who works for us is expected to do their utmost to meet our customers' needs, day after day, and act quickly and efficiently if something goes wrong. It is clear from Ofcom's findings that we did not do that often enough or well enough on a number of occasions. We offer our profound apologies to anyone affected by these errors.”
The blue-chip company, which has agreed to take a settlement in return for a 7.5 percent reduction in the penalty, must pay the fine to Ofcom within 20 working days, which will then be passed on to the Treasury.