iPhone targeted in Carphone insurance scam

Sales staff at Carphone Warehouse have been accused of mis-selling insurance for the Apple iPhone.

The staff claim that iPhone buyers need to out take out Carphone's own insurance or risk coughing up £630 for a new 18-month iPhone contract. In reality, all you need do is buy a new handset for £270 - your existing O2 contract will continue.

The mis-selling scam has been uncovered by undercover reporters working for the BBC's Watchdog programme. In the show - being broadcast at 8pm tonight - staff in three out of five Carphone Warehouse locations visited by the reporters are shown to be mis-selling iPhone insurance. In once case a sales consultant is seen arguing that Carphone Warehouse's insurance is more comprehensive than that offered by O2. This is wrong again.

Commenting on allegations made in the Watchdog programme, Carphone Warehouse said that there might have been "some element of confusion among an isolated number of sales consultants."

iPhone insurance

Carphone Warehouse added that the complaints to the BBC did not represent "a fair reflection of the experience of thousands of Apple iPhone customers who have received insurance advice in our stores".

Carphone Warehouse has been in trouble over insurance mis-selling before - the result was a £245,000 fine from the Financial Services Authority (FSA) last year, the BBC says.