Tel4U Ltd

Publication Date
5 September 2013
Case Reference
Track 2
Adjudicated Party
Tel4U Ltd
Service Type
Tribunal's final assessment
Very Serious
Code 12 para 4.8.2b - Formal reprimand and/or warning
Code 12 para 4.8.2d - Fine
Code 12 para 4.8.2g - Prohibition all PRS
Code 12 para 4.8.2j - Universal refunds
Breaches raised

Between 10 January 2013 and 1 February 2013, PhonepayPlus received five complaints from consumers regarding a payday loan recorded information telephone line (the “Service”) operated by the Level 2 provider Tel4U Ltd. The Level 1 provider was O-Bit Telecom Limited.

The Service was operated on the premium rate numbers 09050022777, 09050022999 and 09825555555. The cost of the call was £1.53 per minute and lasted approximately 3 minutes and 16 seconds per call. The Service operated between December 2012 and 13 February 2013 when, following an exchange of correspondence with PhonepayPlus, the Service was terminated. The Service was promoted by SMS message.

The Service offered consumers the opportunity to listen to a recorded message containing generic payday loan information. At the end of the recorded message, the premium rate call disconnected.

The majority of the complainants stated that the SMS messages they received were unsolicited. In addition, complainants stated that the promotional SMS messages did not contain any pricing information. The total cost per call was approximately £4.99 (from a landline).

The Executive raised the following potential breaches of the PhonepayPlus Code of Practice (12th Edition) (the "Code"):

• Rule 2.2.5 – Pricing prominence and proximity
• Rule 2.4.2 ¬– Consent to market
• Paragraph 3.4.12 (a) – Registration of numbers

The Tribunal upheld all breaches raised. The Level 2 provider’s revenue in relation to the Service was within the range of Band 6 (£1 - £5,000). The Tribunal considered the case to be very serious and issued a formal reprimand, a fine of £10,000, a prohibition on the Level 2 provider from providing or having any involvement in, any premium rate service or promotion for five years, starting from the date of publication of the decision and a requirement that the Level 2 provider make refunds, within three months, to all consumers who have used the Service for the full amount spent, regardless of whether or not they have claimed a refund. Refunds should be directly credited to the users’ telephone accounts and the Level 2 provider must provide evidence to PhonepayPlus that the refunds have been made.