Progress? Updates from PhonepayPlus

Today I was called by the head of customer service at PhonepayPlus, the regulator for premium rate services.

It was a constructive conversation where a lot of the background of the current situation was explained, and I was finally given some concrete answers to questions.

It is clear that there has been a lot of complication caused by the “Own Portal” issue which has been mentioned in this blog and elsewhere before. Essentially this clause decides whether a service is subject to regulation by PhonepayPlus or by Ofcom. The nature of EE’s relationship with Mobitrans is such that it has lead to a great deal of confusion about who is responsible, with EE very clearly benefiting from the situation.

The important points from today’s conversation:

What does “Own Portal” really mean?

In the regulatory framework for premium rate services, a concession is made to premium services offered by the mobile phone company themselves. In short, because the customer has a contract with them, they aren’t expected to jump through authorisation hoops in order to bill you for extra services they sell you. It should be as easy for a mobile operator to sell you football score text messages as it is for them to sell you top-ups, changes in tariff and so on.

The problem appears to be that this has turned out to be a loophole through which EE has allowed several premium operators to sidestep the expected regulation and safeguards. EE has “outsourced” provision of services such as Mobile Academy to these premium operators, but critically they have also outsourced the customer service, the complaints and (as far as I can tell) the policing of the payments to those same companies. They have also, clearly, not informed the customers or customer service staff of this so when questioned, consumers are mislead and told that these are third party companies. While it is true that they are third parties, they are third parties acting under EE’s special privilege so that they can sidestep the normal regulation and safeguards.

This critical point is why so many customers are claiming they didn’t sign up through the Payforit screens that they are told they must have seen: because by permitting them access under the “Own Portal” loophole, EE has allowed them to skip this important step.

EE has passed on the special privilege it has as the company you have a contract with to several third party companies, including Mobitrans, but has clearly failed to either monitor their company, or to correctly inform customers of the nature of the arrangement when they’ve complained.

PhonepayPlus inform me that they first became aware of this problem at the start of the year and have been in discussions with Ofcom about it since May. Unfortunately, they have no channel to talk to EE themselves and until recently, no-one at EE has been prepared to discuss the matter directly with them.

What Happens Next To Mobitrans?

On the question of Mobitrans, an upcoming change means that PhonepayPlus will be able to consider Mobitrans within their remit and, though they stressed that they are not formally “investigating”, they will be able to “assess” Mobitrans. I got the impression this was a legal differentiation which was necessary at this stage. They have also told me that since Mobitrans are based in the Netherlands, they are required to first seek permission from the authorities in the Netherlands before proceeding any further.

I have been offered fortnightly phone updates on the assessment process.

What Happens Next To EE?

PhonepayPlus are still not empowered to take any action against EE. EE come entirely under the regulation of Ofcom. However, it is clear that there is a case to answer for several reasons.

• EE have, deliberately or through wilful incompetence, been misinforming customers for months or years over the nature of the relationship with Mobitrans and redirecting customers to PhonepayPlus when there is clearly nothing that PhonepayPlus can do to help.
• Under the terms of the “Own Portal” clause, EE are responsible for these charges and they should be investigating and refunding customers themselves, not passing the buck. Their claims that it is nothing to do with them, and the impression they give that somehow Mobitrans took payment without EE’s involvement, are  false, misleading and clearly in contravention of the rules.
• In giving third parties access to a loophole which allows them to sidestep the safeguards put in place by the regulator, and in then failing to properly monitor the conduct of those third parties, they have been unacceptably negligent with customer security.
• Most importantly: legally, if a customer challenges a payment that has been taken EE should either provide appropriate evidence of authorisation, or they should refund the customer. They have no legal right to take payment and demand we prove that we didn’t authorise it. Again, they cannot pass the buck on this: legally, they need to prove they had a right to take our money.

I am in contact with Ofcom about this as I believe there is clear evidence that EE have breached both the regulations and the law on multiple counts here.

Citizens Advice Bureau: “If they cannot provide evidence they should refund your money.”

I have spoken to the Citizen’s Advice Bureau about one of the central points about this case, namely that it is not right that EE can take money from customers’ accounts, insisting it was authorised, and yet not provide any evidence of that authorisation.

We understand from your email that you are having issues with being charged on your mobile account for a service you did not ask for.

Your rights and obligations:
If someone has taken money from you for a service they claim you have
agreed to pay for, then it is reasonable for you to request that they
provide evidence that you formed a contract with them for what they are
asking you to pay. If they cannot provide evidence of this, then you can
argue there is no legal contract in place and they should refund your money.

Criminal offence:
As the trader’s actions could be considered a criminal offence we will be
passing this information onto the appropriate Trading Standards authorities
to make them aware of your concerns. The case is being with referred with
no commitment to contact yourself, but they may contact you if they wish to
discuss the matter further or require further information.

On asking for further information about the Trading Standards report however, I got back a slightly less positive response:

Although we work closely with Trading Standards, we are not an enforcement agency. Instead our role is to offer first stage civil advice; as such, we pass complaints of this nature to Trading Standards so they can evaluate whether or not enforcement action can and should be taken. It is worth bearing in mind that enforcement action can take a long time to process. In addition, a criminal investigation can be expensive; therefore another factor a Trading Standards authority would need to consider would be if the investigation would be of a significant benefit to the general public.

Subsequently, Trading Standards inform us that information provided by  members of the public can become useful many years after it has been submitted. Furthermore, Trading Standards rarely provide feedback to  members of the public. The reason for this is twofold: not only does it  have the potential to hamper any ongoing investigation; but there are not always the resources to inform members of the public about how a complaint has progressed and (when applicable) what the outcome has been. The information is, however, valuable intelligence which allows Trading Standards to properly prioritize their activities.

Which sounds more like the familiar assurance that something is being done, even if it seems as though it’s been ignored.

Ofcom Update: PhonepayPlus really revisiting this time.

Copy of the latest update from Ofcom. Still no actual acknowledgement of the specific issues I have asked questions about, and it’s another buck-passing email but it does at least assure me (again) that PhonepayPlus are within their remit to act.

This does sound like a very similar response to the one from last month, which PhonepayPlus then flatly contradicted, but here is the text in full:

Thank you for your email of 9 November 2015. You also sent Ofcom a copy of your email of the same date to PhonepayPlus in which you request an update in terms of the Mobitrans service ‘Mobile Academy’.

In light of your comments, we have had further engagement with PhonepayPlus on this matter. PhonepayPlus have confirmed that they have further reviewed their position in respect of this service, including holding further discussions with EE to understand more precisely who is providing the service.

We understand that following those discussions PhonepayPlus has established that EE does not regard the service as being an “own-portal” service and, therefore, it would be a service which, subject to European law requirements, would fall under the regulatory remit of PhonepayPlus. PhonepayPlus will be in touch with you shortly to discuss your concerns further.

I am slightly surprised by the sentence highlighted stating that EE does not regard the service as own-portal. Surely it should be down to the regulator to make their own assessment of this, not to simply be told so by the company they are supposed to be regulating?

In any case, we will see if this leads to any further updates.

Ofcom still failing to grasp the complaint

The latest frustrating response from Ofcom:

I am sorry that you remain unhappy with our responses. As we have stressed in  our previous responses, there are clear rules in place which mean providers cannot simply demonstrate consent to charge for premium rate services without meeting certain strict criteria.

The problem that we seem to be failing to get across is that we know that this is what the process is supposed to be, and that’s not what we’re seeing happening.

What we’re seeing is a contravention of these rules. Charges are being applied to accounts with consumers claiming that they did not authorise them and EE and Mobitrans are not offering a shred of evidence to back up the claims that they did. They are simply refusing refunds on the basis that they wouldn’t have applied the charges without consent.

That’s the reason we’re complaining to you Ofcom: because the rules you state must be followed are clearly not being followed! Not investigating persistent reports of a breach of the rules on the basis that there are rules in place which must be followed is entirely missing the point.

Some Technical Facts

We can’t all be experts in mobile communications and the technology behind the Internet. Often, when complaining to a company such as EE or Mobitrans, they will use this to their advantage by making plausible-sounding claims or drowning you in technobabble to the point that you don’t feel you’ve got a response. Here are some common claims.