The consumer watchdog is suing Optus for allegedly selling hundreds of people — including those experiencing vulnerability and disadvantage — goods and services they didn't want or need.
The Australian Competition and Consumer Commission (ACCC) commenced proceedings against the telecommunications company in the Federal Court on Thursday, accusing it of "unconscionable conduct".
The ACCC alleges Optus broke consumer laws by putting pressure on people to buy expensive products and accessories, neglecting to verify whether customers had coverage in their area, and using debt collectors to pursue customers who failed to make payments on these sales.
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The ACCC also said many of these consumers were experiencing "vulnerability and/or disadvantage, such as living with a mental disability, diminished cognitive capacity or learning difficulties, being financially dependent or unemployed, or having limited financial and legal literacy".
Many of the 429 consumers included in the case were First Nations Australians from regional and remote areas or people from culturally and linguistically diverse backgrounds.
ACCC chair Gina Cass-Gottlieb said many consumers "suffered financial harm, incurring thousands of dollars of debt and non-financial harm, such as shame, fear, and emotional distress about the debts or being pursued by debt collectors".
Cass-Gottlieb also alleged that Optus continued these practices even after management became aware of sales staff exploiting deficiencies in its systems.
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What does the ACCC allege?
The majority of the customers were in the Northern Territory, where senior management at two Darwin stores operated by a licensee, Suntel Communications, allegedly encouraged staff to engage in inappropriate sales conduct over a two-year period ending in mid-2023.
At another since-shuttered store in Mount Isa, Queensland, a staff member allegedly fraudulently created contracts without customers' knowledge, with dozens of them then pursued for debts.
Another 24 customers at other stores were allegedly placed under undue pressure and persuaded to buy a large number of products.
Some of them were allegedly given false, misleading or deceptive representations that particular goods were free.
In one incident alleged by the ACCC, a person with an intellectual disability was sold an expensive phone with a business contract under a false ABN as well as a new NBN plan and accessories.
They were left upset and embarrassed by the unnecessary purchases, but staff allegedly refused to cancel the contracts until a financial counsellor became involved.
An Optus spokesperson said the company was reviewing the ACCC's claims and would respond with more detail in due course.
