Excite Mobile busted for creating a fake debt collector and dodgy complaints company

There's nothing Exciting about crime, kids

In the list of "things not to do as a telecommunications company", creating a dodgy "independent" complaints hotline and fake debt collectors who threaten to take away children's toys as payments are at the top of the list.

But it looks like Excite Mobile didn't get the memo, as the Federal Court of Australia has just busted the telco for doing just that.

The company, which ran on Optus' mobile network, preyed on lower socio-economic customers, particularly in indigenous communities in remote parts of the country.

With contracts that locked customers in for two years, and only allowed customers to make two minutes worth of calls a day before excess charges kicked in, often in areas without Optus coverage, things were never above board with the MVNO.

There was also a $75 cool off fee and a $195 fee for returning a phone, even if nothing more than the box was damaged.

If that's not enough, also among the laundry list of questionable acts was the creation of its own complaints department, which it called "Telecommunication Industry Complaints".

While dealing with complaints is perfectly fine, Excite Mobile did its best to convince its unhappy customers that the organisation was an independent body in the same vein as the Telecommunications Industry Ombudsman (TIO).

The Ballad of Jerry Hastings

Worse than the complaints situation though was the creation of a fictitious debt collector named Jerry Hastings. Excite Mobile used the character or Jerry Hastings to send threatening letters to at least 1074 customers.

The letters were misleading, and went so far as to demand additional late payments of 20 per cent of the original debt as well as the repossession of assets, going so far as to actually demand children's toys.

The Federal Court found that Jerry Hastings was in fact a fictitious character, and every demand he sent came directly from Excite Mobile.

The Penalty

While the penalty is yet to be handed down, Excite Mobile does face a $1.1 million fine for every breach of the trades legislation.

In addition, the ACCC is hoping that the company's directors be barred from running a company for at least five years.

ABOUT THE AUTHOR

Editor (Australia)

Nick (Twitter, Google+) is TechRadar's Australian editor, covering all the latest news and reviews from the Great Southern Land. Having spent the past decade editing some of Australia's leading technology publications, Nick's passion for the latest gadgetry is matched only by his love of watching Australia beat England in the rugby.