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£250,000 fine for company which misled consumers into calling 118 numbers

27 June 2019

PSA issues fine, bar on service, and general refunds order to company which placed messages on phone lines instructing callers to dial a premium rate Directory Enquiries number

A company operating a misleading Directory Enquiries service has been issued with a £250,000 fine by the regulator, the Phone-paid Services Authority (PSA).

The company (Madlenka Limited) placed promotions online directing consumers who were looking for helplines for companies including the AA, RAC and Sky to call an 0345-number, operated by the company. 

Calls made to these numbers between 9am and 5pm Monday to Friday connected consumers to the desired companies’ helplines. However, calls made out of hours or on weekends directed consumers to call the expensive Directory Enquiries line, with the following message: 

“You can still talk to us on our out-of-hours service. Please hang up and redial 118 068. That number again is 118 068. Calls cost £6.98 per call, plus £3.49 per minute, plus your company’s access charge.”

Many consumers said that they found this message confusing and reported surprise at having been charged significantly more than expected after making the calls. One consumer said: 

“I called AA breakdown cover line on 0345 174 4023 at 19:41 to report my car tyre punctured. However, when I received my O2 bill, I observed a charge of £61.82 on a number: 118 068… I feel this is unfair, as I had originally dialled the number 0345, which was inclusive in my minutes, not knowing that the number I am being transferred is a chargeable number.” 

The PSA received 11 complaints about the service between 31st May 2018 and 12th June 2019. 

The PSA Tribunal found that the company had failed to adequately inform consumers of the cost of calls in advance of them using the service. They also considered the service misleading. These are both breaches of the PSA Code of Practice, incurring sanctions. 

The company has been issued with a £250,000 fine, a formal reprimand, and a bar on the service until the issues have been resolved to the PSA’s satisfaction. 

A General Refund sanction has also been ordered, meaning that all consumers who are eligible for a refund and apply for one from the company must receive one. 

View the adjudication in full here.