More than a week after the Australian Federal Court fined Optus 100 million Australian dollars (US$66 million) for selling phone and Internet services to disadvantaged customers who could not afford them, it is now Telstra's turn to face the music with a court-ordered fine for misleading nearly 9,000 customers by switching them to a lower-speed plan without their knowledge.
For the violation of the Australian Consumer Law, the court ordered Telstra to pay a penalty of AU$18 million (approximately $12 million) to the affected customers of its budget Belong brand, according to the Australian Competition & Consumer Commission (ACCC) in a statement released on Friday.
"The $18 million penalty sends a strong message to all businesses that they cannot mislead consumers by making changes to key aspects of a service without informing customers of those changes," said ACCC Commissioner Anna Brakey.
The court ruling was handed down nearly three years after the consumer watchdog sued Telstra for its misleading conduct in December 2022.
The court case filed against Telstra stemmed from its decision to alter the service plan of 8,897 Belong customers. Telstra cut the maximum upload speed by 50%, reducing it from 40 Mbit/s to 20 Mbit/s. Meanwhile, the download speed remained at 100 Mbit/s.
This change was made between October and November 2020, and customers were not informed.
"Telstra's failure to inform customers that their broadband service had been changed...
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