Mobile phone network Giffgaff has been fined £1.4m by regulator Ofcom for "unacceptable" billing errors that let to 2.6 million customers being overcharged.
The regulator said Giffgaff, which is owned by O2’s parent Telefonica, overcharged its customers by a total of almost £2.9m.
The issue took place because customers who purchased a Giffgaff "goodybag" bundle – comprising voice and text minutes as well as data allowances – using their prepaid credit, were overcharged.
This was because there was a delay in Giffgaff applying the bundle purchase to their accounts. It meant that any voice calls customers were making, or the data they were using at the time, came out of their pre-paid credit. These services should have been free immediately from the point the bundle was purchased – so the customers were effectively charged twice.
Ofcom’s director of investigations and enforcement said: “Getting bills right is a basic duty for every phone company. But Giffgaff made unacceptable mistakes, leaving millions of customers out of pocket.
“This fine should serve as a warning to all communications providers: if they get bills wrong, we’ll step in to protect customers.”
Giffgaff has already refunded around £2.1m to affected customers. In lieu of those customers it has not been able to trace and refund, it has donated the money to charity.