Broadband provider fined £28m after it prevented its customers from cancelling contracts

Ofcom fined the broadband company £28 million after it made it considerably more difficult for customers to switch to another provider. The penalty already includes a 30% reduction which Ofcom agreed to given the company’s agreement to settle.

In its investigation, Ofcom found that the company had split its customer retention team into two tiers. Agents in the second tier only could progress cancellations. The system meant that customers had to request a cancellation twice through two separate agents.

Frustrated customers took to cancelling direct debits to end their contracts negatively impacting their credit score. Customer calls were also deliberately mishandled, prematurely ended, and excessively put on hold. This behaviour was encouraged by the company’s commission scheme which financially rewarded operatives. The company also failed to monitor the quality of its customer experience.

In calculating the penalty, Ofcom’s considerations included:

• Significance of widespread harm to customers
• Repeated failures by the company to prevent further harm and provide information during investigations
• The fact the company had breached the same rule in 2018
• The company’s potential financial gain