'Inexcusable and unacceptable': Optus CEO Stephen Rue apologises for sales misconduct
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More news: Optus CEO Stephen Rue said his company's misconduct was "inexcusable and unacceptable" after the telco agreed to pay a $100 million penalty for engaging in unconscionable conduct and inappropriate sales practices between 2019 and 2023.
Rue confirmed that impacted customers are receiving refunds as part of a remediation program. He also said numerous changes have been made to Optus' executive and senior leadership, including disciplinary action in some circumstances such as the termination of retail sales staff found to be responsible for inappropriate sales practices.
Optus has made structural accountability changes and introduced new sales incentives to increase quality control and customer experience metrics.
What they said: “I would like to sincerely apologise to all customers affected by the misconduct in some of our stores,” Rue said.
“Optus failed these customers, and the company should have acted more quickly when the misconduct was first reported," he said.
“I am leading the implementation of extensive changes across the company with active responses to the issues raised well underway.
“However, there is much more to do as we work to regain our customers' trust and improve support and protections for them, especially for those who are vulnerable.”
Optus agrees to pay $100m penalty for unconscionable conduct
The news: Telecommunications business Optus has agreed to a $100 million penalty, after admitting to engaging in unconscionable conduct when selling goods and services to hundreds of consumers, following court action brought by the Australian Competition and Consumer Commission (ACCC).
The numbers: Optus has admitted that its sales staff acted unconscionably when selling phones and contracts to over 400 consumers at 16 different stores across Australia between August 2019 and July 2023.
The context: As part of an agreement announced this morning, the ACCC and Optus will jointly ask the Federal Court to impose a total penalty of $100 million on Optus for breaching the Australian Consumer Law. The Court will decide whether the penalty is appropriate and to make other orders.
The ACCC said Optus staff sold inappropriate, unwanted or unaffordable mobiles and phone plans to people who are vulnerable or experiencing disadvantage.
This included people living with a mental disability, diminished cognitive capacity or learning difficulties, being financially dependent or unemployed, having limited financial literacy or English not being a first language. Many of the consumers were First Nations Australians from regional, remote and very remote parts of Australia.
Optus also engaged debt collectors to pursue some consumers, even after launching internal investigations into its own sales conduct.
Optus has signed an undertaking, accepted by the ACCC, that it will compensate impacted consumers and improve its internal systems, the commencement of which is subject to the court making relevant orders.
What they said: “Many of these consumers who were vulnerable or experiencing disadvantage also experienced significant financial harm,” ACCC deputy chair Catriona Lowe said.
“They accrued thousands of dollars of unexpected debt and some were pursued by debt collectors, in some instances for years.”
The sources: ACCC media release, Optus media release
