Canada’s telecom majors fined $31 million for misleading ads
17 Sep 2012
Canada's Competition Bureau has begun legal proceedings against the country's three biggest mobile operators Bell Canada, Rogers Communications Inc and Telus Corp for allegedly misleading customers about the cost of premium texting services.
After a five-month investigation, the Competition Bureau, the country's independent law enforcement agency, is seeking penalties amounting $10 million each from the three operators and $1 million from the Canadian Wireless Telecommunications Association (CWTA), and also full refunds to the customers.
The watchdog believes that Bell, Rogers and Telus, in conjunction with the CWTA sold premium-rate digital content such as trivia questions and ringtones to their customers for fees that had not been adequately disclosed, according to a statement by the Competition Bureau.
Customers were made to believe that this content was free, and consequently, the three mobile operators gained a share of the revenues they collected. Moreover, the companies and the CWTA led customers to believe that measures were in place to prevent these unauthorised charges.
The services can cost $10 per transaction, and up to $40 for a monthly subscription, rates over an above standard text messaging plans.
Competition commissioner Melanie Aitken said, ''Our investigation revealed that consumers were under the false impression that certain texts and apps were free.''
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