Vodafone Fined £4.6m by Ofcom

Vodafone Fined £4.6m by Ofcom
Regulator Ofcom has fined Vodafone £4.6m for “serious” breaches of consumer protection rules, its largest fine to date for a telecoms operator. The regulator said Vodafone had misled pay-as-you-go customers, charging them for top-up credit but “providing nothing in return”. It also found Vodafone had broken the rules on handling customer complaints.


Vodafone offered its “profound apologies” for the failures said it was “determined to put everything right”. The fine stems from two earlier investigations into Vodafone, which has 20 million mobile customers in the UK. One found that 10,452 pay-as-you-go customers lost out when Vodafone failed to credit their accounts after they paid to top-up their mobile phone credit.

The affected customers collectively lost £150,000 over a 17-month period, Ofcom said.

The problems were caused by IT issues linked to the company’s move to a new billing system.

However, Vodafone “failed to act quickly enough to identify or address these problems” and only moved to fix the issue after Ofcom intervened, the regulator said.

A second investigation found that Vodafone’s customer service agents were not given “sufficiently clear guidance” on what constituted a customer complaint. Moreover, poor processes meant some complaints were not handled “in a fair, timely manner”.

The firm also failed to ensure customers were told, in writing, of their right to take an unresolved complaint to a third-party resolution scheme after eight weeks.

In a statement, Vodafone said it had “fully refunded or re-credited” 10,422 pay-as-you-go customers out of the 10,452 affected. It said it was unable to track down the remaining 30 affected. It also said it had invested in better customer service and training.

“Everyone who works for us is expected to do their utmost to meet our customers’ needs,” it said. “It is clear from Ofcom’s findings that we did not do that often enough or well enough on a number of occasions. We offer our profound apologies to anyone affected by these errors.”

Lindsey Fussell, Ofcom Consumer Group director, said: “Vodafone’s failings were serious and unacceptable, and these fines send a clear warning to all telecoms companies. “Phone services are a vital part of people’s lives, and we expect all customers to be treated fairly and in good faith.”

Vodafone Takes over Phones 4U Stores

Vodafone Takes over Phones 4U Stores
Vodafone UK has reached an agreement with the administrators of Phones 4U to take over 140 of the outlets run by the phone company that collapsed earlier this week.

Administrators PwC said 887 jobs for shop employees across the UK would be preserved. The stores will be rebranded as Vodafone stores over the coming weeks. However, 628 employees at Phones 4U head office in Newcastle Under Lyme are losing their jobs.

The administrators said the “need to cut costs in the business” had led to the decision to reduce numbers at the company’s headquarters.

At the head office 400 employees are being retained to work on managing the restructuring process.  “It is with great sadness and regret that we have today made the difficult decision,” said Rob Hunt, joint administrator and PwC partner.

Dixons Carphone has already agreed to take over more than 800 staff working at Phones 4U concessions within their Currys and PC World outlets.

PwC said the deal with Vodafone represents value for Phones 4U’s creditors. “We have worked rapidly over the course of the week following our appointment to explore interest in the Phones 4U business and we are very pleased to secure a future for a significant number of stores and continued employment for 887 of the Phones 4U people,” said Mr Hunt.

The deal with Vodafone is subject to court approval. PwC said there would not be an announcement of which stores were

Vodafone Considers US Withdrawal

Vodafone Considers US Withdrawal
The Newbury-based company is in talks with its US partner over a sale of the company’s stake in Verizon Wireless. Mobile phone giant Vodafone is reported to be mulling its exit from America in one of the largest corporate transactions of all time.

The Newbury-based company has recently been in talks with its US partner, Verizon Communications, over a sale of Vodafone’s 45% stake in Verizon Wireless, which is America’s largest mobile phone operator. Options have included a merger of the two telecoms giants and the partial sale of Vodafone’s stake but the UK company is now leaning towards making a clean break from America, according to the Sunday Times.

A deal could be struck as soon as this summer and be worth as much as $135bn (£88bn), which compares with AOL’s record $164bn takeover of Time Warner in 2001. Vodafone has a market capitalisation of £90bn, which means the bulk of its value is locked up in a business where it has no day-to-day control.

The company is likely to use the proceeds from any sale on a major European deal or a return of cash to shareholders. However, chief executive Vittorio Colao is not thought to be in any hurry to quit America and may opt against selling the asset, the newspaper added.