Between 21 July 2014 and 18 March 2015, PhonepayPlus received 47 complaints from consumers in relation to a video subscription service (the “Service”) operated by the Level 2 provider, Infernal Publishing Ltd (the “Level 2 provider”). The Service operated under the brand name “TV Babes” on the premium rate shortcodes 69500 and 79900. Consumers were charged £1.50 per week. The Executive understood that the following Level 1 providers had been in the value chain at some point: Velti DR Limited, GSO MMBU Private Company Limited trading as mGage, Sensoria Communications Limited and Fonix Mobile Limited; but where the Level 1 providers sat in the value chain was not known. The Level 2 provider submitted that the Service commenced operation in July 2014 (although the the Service appeared to have been operating using the same brand name since November 2011). The Level 2 provider stated that it had suspended promotions for the Service in January 2015.
Complainants routinely stated that they had received unsolicited, reverse-billed SMS messages and that they had not engaged with the Service.
The Executive raised the following potential breaches of the PhonepayPlus Code of Practice (12th Edition) (the "Code"):
• Rule 2.2.1 – Provision of information likely to influence decision to purchase
• Rule 2.3.3 - Consent to charge
• Rule 2.2.5 – Pricing prominence and proximity
• Rule 2.2.1 (a) – Provision of the Level 2 provider’s identity
The Tribunal upheld all breaches of the Code raised. The Level 2 provider’s revenue in relation to the Service was within the range of Band 3 (£250,000- £499,999). The Tribunal considered the case to be serious and imposed a formal reprimand, a fine of £100,000, a requirement that the Level 2 provider seek compliance advice for the Service within two weeks of the date of publication of this decision, and for any other similar services that the Level 2 provider operates in the future, within two weeks from the commencement date of those services, and thereafter to implement that advice within two weeks (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%