Telstra, Optus and TPG have been fined under a customer refund scheme for fake internet speed claims

Nearly 120,000 consumers from three major Australian telecom companies are entitled to a refund after being misled about internet speeds.

Telstra, Optus and TPG were fined a total of $33.5 million by federal court on Friday following legal action by the Australian Competition and Consumer Commission.

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The misleading claims were made in 2019 and 2020 and the companies have started contacting affected customers and refunding them.

However, the ACCC says Optus was ordered by the court to “recontact affected customers who have not yet responded to previous contact or who have been granted credit to offer compensation within 120 days.”

Telstra reportedly returned $11 million to customers in 2021, while Optus and TPG agreed to return $6.5 million to customers this year.

The ACCC has also warned Optus customers to beware of compensation scheme-related scams after their information was obtained by cybercriminals when the company was hacked in September.

The Consumer Protection Agency argued that the companies could not deliver the Internet speeds advertised in their 50 Mbps or 100 Mbps fiber-to-the-node (FTTN) plans.

In addition to refunding customer funds, Telstra will pay $15 million in penalties, while Optus agreed to pay $13.5 million and TPG $5 million, in agreements approved by Judge Mark Moshinsky on Friday became.

Each of the three providers has admitted liability for violations of the Australian consumer law, Moshinsky said.

Three separate cases have been brought by the ACCC for allegations made to residential customers about broadband internet services using the NBN.

“Significant Penalties”

The judge said each of the renderings was different but largely involved customers who were told their maximum achievable speeds would be tested within a reasonable time.

In most cases this happened, but some customers didn’t have the speeds tested and ended up subscribing to a plan for speeds they couldn’t achieve.

Customers were not notified or given an opportunity to switch to a different plan, Judge Moshinsky said.

“Fast and reliable internet is a necessity for Australian households and consumers need accurate information when choosing the best internet plan for their needs,” said ACCC Commissioner Liza Carver.

“These significant penalties reflect the seriousness of consumer law violations by these large and sophisticated companies.”

– With AAP