Between 20 October 2014 and 21 September 2015 PhonepayPlus received 54 complaints from consumers in relation to a virtual text chat service which was operated on the dedicated shortcode 88006 (the “Service”). The Level 2 provider for the Service was Olmera Group Ltd (the “Level 2 provider”). The Level 1 providers for the Service were Oxygen8 Communications UK Limited (“Oxygen8”) and Mobivate Limited (“Mobivate”). Mobivate contracted with Oxygen8 for Service shortcode 88006, which it in turn supplied to the Level 2 provider.
Complainants variously stated that they were misled into the Service, that they did not know what the Service was, that they were unable to leave the Service or that they had not entered the Service and consented to the charges.
After analysing other Service material including promotional material and message logs, the Executive also identified concerns with the use of the selected shortcode for the Service, provider registration, and the omission from promotional material of information likely to influence a consumer’s decision to purchase.
The Executive raised the following potential breaches of the PhonepayPlus Code of Practice (12th Edition) (the “Code"):
- Rule 2.3.2 – Misleading
- Paragraph 3.9.2 – Appropriate use of a number range
- Paragraph 3.4.1 – Registration of the Level 2 provider
- Rule 2.4.2 – Consent to market
- Rule 2.2.1(a) – Provision of the Level 2 provider’s identity and contact details
- Rule 2.2.5 – Pricing information
The Tribunal upheld each of the breaches of the Code raised. The Level 2 provider’s revenue was within the range of Band 3 (£250,000 - £500,000). The Tribunal considered the case to be serious, and issued a formal reprimand, a fine of £75,000, a requirement that the Level 2 provider remedy the breaches insofar as it has not already done so, a requirement that the Level 2 provider submit all Service promotional material that is intended for publication to PhonepayPlus for compliance advice for a period of one month from the date of the decision (such advice to be sought within two weeks of the date of publication of the decision and thereafter implemented by the Level 2 provider within two weeks of such advice being provided, subject to any extension of time agreed with PhonepayPlus, to the satisfaction of PhonepayPlus), and a requirement that the Level 2 provider must refund all consumers who claim a refund, for the full amount spent by them on the service, within 28 days of their claim, save where there is good cause to believe that such claims are not valid, and provide evidence to PhonepayPlus that such refunds have been made.
Administrative charge recommendation: 100%