ACCAN Informed Consent Project (21 August 2009)

4.2. Absence of consent

Case study 1 – [from Ministerial correspondence]
Case study 2 – [from Ministerial correspondence]

Caseworkers continue to report cases where the consumer denies all knowledge of a service that appears on their bill. In the Project Survey, caseworker organisations and regulators reported a low to moderate volume of complaints regarding the absence of consent.

The TIO includes this category of consent complaints in a broader category (including general sales tactics) so it is difficult to get an exact break-down from their database, but that broader category accounts for over 19,000 complaints each year.

Complaints regarding the absence of consent are dominated by issues arising from MPS – this issue may therefore be addressed by the new approach to MPS regulation and the use of double opt-in.

Case study 1 – [from Ministerial correspondence]

Like many parents, a father allowed his teenage children to have a pre-paid mobile phone for security reasons. The father recently purchased $30 credit for his son’s pre-paid mobile phone and despite his son making no phone calls or SMS, the credit was gone in 24 hours. The father contacted his phone company and was told that his son’s mobile had received and was charged for 6 premium SMS in that period (many of them promotional material), which absorbed the credit.

The phone company also informed him that if he wanted to stop access to premium rate services from his children’s mobiles it would take 10 working days and that he would have to re-credit the mobile phone before a ‘STOP’ message could be sent to the content provider. On further complaint, his phone company agreed to credit the mobile with $5 so that the ‘STOP’ message could be sent. The father is concerned that these premium rate services are using up his son’s credit, which will compromise his son’s ability to contact him in an emergency.

The phone company has told him that it is not responsible for the charges; that they simply provide the phone service and network and that he is responsible for any interactions with third-parties such as content providers.

The volume of complaints regarding the complete absence of consent is extremely high when compared to other sectors. It is difficult to imagine how other sectors (such as health and financial services) could continue to operate in the face of similar concerns regarding the absence of consent.

However, in the communications sector this issue is not entirely surprising given the enormous diversity in industry processes for obtaining consent and the lack of strong requirements to confirm consent before billing. Indeed, there is a clear link between the ease of billing individuals in the communications sector and complaints regarding the absence of consent. The following factors have all contributed to this issue:

Content providers not require an individual account / relationship with the consumer;
Both content providers and service providers can simply add new items to an existing bill rather than issuing a new or separate bill;
Collecting payments is automated through direct debits or through prepaid services;
Billing relies on a system of trust between content providers and service providers;
To date there have been only minor repercussions for mistaken or exploitative billing practices (e.g. repayment to one consumer rather than systemic change); and
There is a history of service providers informally settling consumer complaints without repercussions for content providers.

All of this has contributed to the prevalence of charges on communications bills where the consumer denies any knowledge of the service or of consenting to the charge.

Case study 2 – [from Ministerial correspondence]

A retired doctor complained about an unexpected $7 charge that appeared on his mobile phone bill. The doctor queried the unexpected charge with his provider. He was told he, or someone else who had access to his phone, had subscribed to a mobile premium service.

The doctor explained that he used his mobile phone sparingly, switching it on only to make a call when away from his home. He used a landline phone at home. He vehemently denied subscribing to any mobile premium service. He also explained that his phone could not have been in the possession of anyone other than himself. The doctor vowed to pursue a refund on principle.





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