Telco hit for misleading and deceptive conduct

The Federal Court has declared phone card company Cardcall engaged in misleading or deceptive conduct in the way it promoted its international phone cards.

The case, which was sparked by an investigation by the Australian Competition and Consumer Commission, is the latest episode in the consumer watchdog’s crackdown on the telecommunications sector.

The ACCC alleged Cardcall used a number of false statements to promote its cards, including a claim that no fees other than timed call charges would be made. In reality, customers were hit with service fees, connection and disconnection charges and other surcharges.

The company also claimed a certain number of minutes was available on the cards, when in fact the total number of minutes could, at best, only be achieved through one continuous call.

Cardcall consented to declarations, injunctions and other orders and contributed $20,000 to the ACCC’s legal costs.

ACCC chairman Graeme Samuel lashed the telecommunications sector, claiming this case and another recent against Tel.Pacific highlighted “a fundamental flaw in the advertising of telecommunications companies that convey a headline message based on pricing, yet qualify it to an almost opposite effect.”

“The ACCC will continue to take action against telecommunications companies who hide additional fees and charges in small print.”