Four years of “unconscionable conduct and inappropriate sales practices” look set to cost Optus $100 million after the telecommunications giant agreed to pay an ACCC fine and commit to an enforceable undertaking for signing up hundreds of customers to services they couldn’t afford.
If accepted by the Federal Court, the settlement would see Optus fined for repeated breaches of Australian Consumer Law (ACL) provisions – punishing behaviour that was first raised in an ACCC lawsuit last November that alleged Optus staff wrongly pushed mobile, business and NBN services.
This included reports that Optus staff had put “undue pressure” on many customers – particularly First Nations customers – to sign contracts for multiple Optus products, in many cases without even checking to see whether the customers would have mobile coverage where they lived.
Some 24 vulnerable or disadvantaged customers were affected by the “inappropriate sales conduct,” Optus admitted, with customers of the company’s Darwin and Mt Isa stores particularly targeted – but the ACCC noting that over 400 consumers at 16 stores nationwide were affected.
One person living with an intellectual disability was signed up to a business phone and NBN contract under a false ABN – leaving the customer “upset and embarrassed,” the ACCC said at the time while noting that some customers were referred to debt collectors when they couldn’t pay.
Others were misled to believe that bundled goods were free, while sales representatives repeatedly failed to explain relevant terms and conditions to consumers “in a manner they could understand” – leaving them unable to appreciate their ongoing payment obligations.
Such conduct is “inexcusable and unacceptable,” Optus CEO Stephen Rue – who was appointed after the conduct in question took place – said in announcing that the telco had “failed these customers” and had accepted the ACCC’s accounts.
“This is not what Optus stands for” and the company “should have acted more quickly when the misconduct was first reported,” Rue said, promising “extensive changes” were already underway – including “structural accountability changes” and “new sales incentives”.
Impacted customers will receive refunds, and Optus will also pay $1 million to support digital literacy initiatives for First Nations Australians.
Raising the bar for anti-consumer behaviour
News of the settlement – which is twice as large as a fine meted out to Telstra in 2021 for similarly “unconscionable” exploitation of First Nations customers – was a relief for communications consumer body ACCAN, whose CEO Carol Bennett wasted no words condemning Optus’s actions.
“Unconscionable conduct is a high bar and one that Optus has spectacularly surpassed in its behaviour,” she said, “preying on some of our most vulnerable communities and consumers.”
“Phone and internet products are not a luxury [but] fundamental and essential services,” Bennett added, saying the “cruel and uncaring” behaviour “beggars belief” and that “it’s no wonder that Optus ranks third in the list of most distrusted companies.”
Amongst the litany of “simply unacceptable” acts by Optus representatives, ACCC deputy chair Catriona Lowe said, reports that Optus had sicced debt collectors on vulnerable or disadvantaged customers – even after internal investigations – had left the regulator “particularly concerned.”
Senior management became aware of the conduct at the time, but failed to correct it even as the company was fighting to right the business after a major data breach and catastrophic service outage.
Riding a surge of pro-consumer enforcement
If approved, the $100 million fine will be one of the largest penalties ever levied by the ACCC, which has struggled to arrest some exploitative behaviour but recently enjoyed a string of significant wins buoyed by an Albanese Labor government that has strengthened protections.
Recent ACCC wins include a $438 million penalty against vocational college Phoenix, a $100 million fine to Qantas, $60 million to Google, the $50 million Telstra fine, $30 million to Airbnb, and even $1 million for an online florist that misrepresented itself as being a local service.
The cavalcade of increased fines came after 2018 legal changes allowed the ACCC to pursue much larger penalties for unconscionable conduct, supplying unsafe goods, making false or misleading statements, and other unfair trade practices.
The planned Telecommunications Amendment (Enhancing Consumer Safeguards) Bill 2025 will further strengthen consumer and data protections, with fines for breaching industry codes, standards, and determinations from $250,000 to around $10 million or 30 per cent of turnover.
The Optus fine comes days after Communications Minister Anika Wells announced that the new, enforceable Telecommunications (Domestic, Family and Sexual Violence Consumer Protections) Industry Standard 2025 has been finalised and will take effect on 1 July.
By supporting another vulnerable group, ACCAN’s Bennett said, that legislation – which obliges telecommunications providers to safe communications, privacy protections, staff training, credit and debt management, and specialist support channels – “reflects best practice”.
