Optus faces $100 million fine over “unconscionable” conduct

Optus is facing penalties of up to $100 million after admitting to claims made by the Australia Competition and Consumer Commission (ACCC) that it had taken advantage of vulnerable customers.

Examples of unconscionable conduct included pressuring vulnerable customers to sign up for goods & services they did not need and could not afford, manipulating credit checks and signing up vulnerable customers for plans without their knowledge or consent.

Optus admitted to unconscionable sales practices had affected many First Nations customers at two stores in Darwin as well as 24 other individuals across Australia. In some situations, the provider admitted to pursuing debts that senior management knew may have been created without the knowledge of affected consumers over a period of years.

ACCC deputy chair Catriona Lowe said that Optus' conduct was unacceptable and that the regulator had heard many stories from those affected who had accrued thousands of dollars in unexpected debts.

"Many of these consumers who were vulnerable or experiencing disadvantage also experienced significant financial harm," she said. 

Optus isn't the first telco that the ACCC have taken to task over these sorts of practices. Back in 2021, Australia's competition watchdog took action against Telstra over similar conduct. 

Like its rival, Optus has publicly admitted that it failed to take steps to prevent the conduct despite its awareness of the issue. As a result, the provider has signed an undertaking agreement with the ACCC and agreed to ask the Federal Court to impose a $100 million fine.

Optus has also agreed to make a $1 million donation to a group facilitating digital literacy of First Nations Australians, compensate affected customers, buy back 34 licensee stores and to formally review its remuneration, complaint handling, staff training, and debt collection systems.

The Australian Communications Consumer Action Network (ACANN) praised the outcome, with CEO Carol Bennett calling out the size of the fine, which may end up being 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," she said.

In a statement, Optus CEO Stephen Rue said the misconduct was inexcusable and apologised to affected customers.

“This is not what Optus stands for and we will hold ourselves to a higher standard going forward,” he said.