BT Group Faces £600 Million ($816.5 Million) for Overcharging Customers

By Adriaan Brits Tuesday, January 19, 2021

A lawsuit has been filed against the British telecom giant BT Group over allegations that the company was overcharging customers for landline services.

BT Denies Allegations

The class-action lawsuit, filed by the law company Mishcon de Reya to the Competition Appeal Tribunal (CAT), is valued at £600 million ($816.5 million). If the lawsuit turns out to be successful, the telecom company might have to pay up to £500 ($680) for each of its 2.3 million business customers.

The lawsuit represents BT consumers who subscribed to the company’s landline services but did not opt for its broadband or pay TV packages. It is a continuation of a years-long situation where different stakeholders are accusing the business of mistreating their customers.

In 2016, the regulatory and competition authority for the broadcasting, telecommunications, and postal industries of the United Kingdom (UK) — Ofcom — said that all of the British landline providers had raised landline rental charges by 28% to 41%.

It accused BT of providing "poor value" for the money it charges. Following Ofcom’s claims, the telecom business slashed the fees for its landline services to £7 ($9.53) a month. Campaigners continued to raise concerns as the company failed to compensate its consumers for previous overcharging.

"Ofcom made it very clear that BT had spent years overcharging landline customers, but did not order it to repay the money it made from this," said Justin Le Patourel, founder of consumer group Collective Action on Landlines (CALL) who’s been an Ofcom employee for 13 years.

"We think millions of BT's most loyal landline customers could be entitled to compensation of up to £500 each, and the filing of this claim starts that process," he added.

BT denied allegations that it was involved in anti-competitive behavior and said it would fight back “vigorously” in court. The company’s spokesperson said the group fulfills its responsibilities to elderly customers and intends to defend the business from any allegations claiming otherwise.

"For many years we've offered discounted landline and broadband packages in what is a competitive market with competing options available, and we take pride in our work with elderly and vulnerable groups, as well as our work on the Customer Fairness agenda," BT spokesman said in a statement.

Shares of the company fell over 1.5% on the lawsuit news.

Summary

A class-action lawsuit against BT Group has been filed for allegedly failing to compensate its customers who were previously overcharged for landline services.

About the Author


Headshot for author Adriaan Brits

As an analyst of global affairs, Adriaan has an MSC from Oxford, with diverse interests in the digital economy, entertainment, and business. He is a specialist trainer in Advanced Analytics & Media.

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