Finance

Director speaks out after ACCC hands out $10,200 fine for an alleged single complaint

Ronelle Richards /

 

The managing director of a telecommunications provider has called dealing with the Australian Competition and Consumer Commission “unfortunate” after his company was issued an infringement notice for misrepresenting information to consumers.

Voiteck is a telephone and internet services provider with offices in every state and a head office in South Australia.

The company has paid a penalty of $10,200 to the ACCC, after the watchdog issued an infringement notice on the grounds it believed Voiteck made misleading representations to retirement village residents.

However, Voiteck managing director Declan O’Callaghan says the incident was based off a single complaint.

Speaking with SmartCompany, O’Callaghan says he was on a flight when the ACCC issued a media statement about the infringement notice unexpectedly, which left them unable to respond in time.

“We’ve been working with the ACCC for approximately six months now in actually reviewing and understanding what the supposed grievance was, put forward by one resident out of 1800 residents,” he says.

 

The ACCC said in a statement it believed Voiteck sent residents at Lifestyle SA retirement village a letter with false information, implying the residents did not have the right to choose their telephone and internet providers.

 

Lifestyle SA selected Voiteck as its ‘preferred’ telecommunications provider last year.

 

According to the ACCC the letter, sent in June of 2015, further stated that Voiteck had been chosen to provide all telecoms services, would become their billing provider in July and would be migrating all residents to new call rates and internet services.

O’Callaghan says all information provided was factual but in the letter “we didn’t provide clarity in one simple communication”.

As a consequence, he says the company was left with two options: accept the infringement notice of the minimum amount or take on the ACCC in the courts.

As a SME, O’Callaghan says Voiteck simply did not have the cash flow or resources to fight the penalty.

Under the Australian Consumer Law, the payment of a penalty specified in an infringement notice is not an admission of contravening the law and O’Callaghan emphasises that Voiteck has not admitted guilt.

O’Callaghan says Voiteck is run on three principles, all of which were implemented at Lifestyle SA.

“We save customer money, anywhere to 30 to 50% on operating costs, we provide extremely great high speed internet and we provide really great customer service,” he says.

O’Callaghan also says many of the retirement village residents have given positive feedback after the migration to Voiteck’s high speed internet.

The ACCC decision has been a blow to the business, he says.

“We were a little bit aggrieved that the ACCC have gone against us,” O’Callaghan says.

Acting ACCC chairman Michael Schaper said in a statement on Friday that protecting vulnerable consumers is a priority for the consumer watchdog.

“Consumer protection issues involving vulnerable consumers, particularly older consumers, is a current enforcement priority for the ACCC,” he said.

“In this case, the ACCC was concerned that residents of Lifestyle SA retirement villages were given the misleading impression that they had no choice of internet and telephone services provider and were required to use Voiteck. In reality, they were free to choose any service provider.”

 

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Ronelle Richards

Ronelle Richards is a former journalist at SmartCompany. She is currently studying a Masters of Journalism at The University of Melbourne and has previously worked as a journalist and photographer in rural newspapers.

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