Telstra has been handed a $50 million fine for its treatment of Indigenous customers in rural and remote parts of Australia.
The telco first came under investigation in 2019 when the ABC revealed dozens of Indigenous customers at five Telstra-branded stores had been sold phone plans they could not afford and did not understand.
In some cases, multiple plans were sold to a single customer on the same day, and many ran up bills in the thousands of dollars for which they were later pursued by debt collectors.
The massive fine is the second-largest penalty a company has ever received in Australia for breaking consumer law.
Consumer watchdog the ACCC launched its investigation in 2019 and found Telstra’s sales practises had caused “severe personal financial hardship and great distress”.
ACCC chair Rod Simms says the customers affected will be fully remediated by Telstra.
“Telstra is already doing that, they’ve got an undertaking to the court that further commits them to doing that. We will watch that but I’m pretty confident given Telstra’s statements that they will make sure those 108 consumers are fully remediated, and obviously if there’s others in a similar situation we’ll be sending them to Telstra as well.”
Mr Simms says during their investigation they became aware of bad behaviour by other telcos.
“We are aware of other behaviour. We’re hoping that this court penalty has sent such a clear message that such bad behaviour will stop, but if it doesn’t we’ll be taking other companies to court.”
In a statement Telstra CEO Andy Penn apologised to all Indigenous customers affected and said the settlement was the end of a “deeply challenging and disappointing chapter” in the company’s history.