In its decision confirmation, Ofcom said that between at least 26 May 2011 and 15 March 2019, O2 contravened GC C3.2 and former rule GC 11.1 by failing to render or make available accurate termination bills to its customers after they cancelled services.
It was also found that O2 overcharged "a significant number of customers" looking to terminate their pay monthly services with the operator.
Around 140,000 customers paid £2.4 million in overcharges while 26,500 customers were overcharged £2.3 million, but did not pay "due to their own inactions". Further, around 85,200 customers were overcharged £35.9 million but had been disconnected by O2 for non-payment of bills and did not pay those charges.
Although Ofcom found O2's actions were a "serious breach" of its rules, the penalty was reduced by 30% due to O2's "admissions of liability and its agreement to enter into a settlement" and the resources this saved Ofcom.
Ofcom has also set out the steps O2 must take to comply with its conditions and remedy the consequences of the contravention.
In a statement provided to Capacity today, O2 said: “As the operator proactively driving over £168m value back to our customers in the last year alone, we are disappointed by this technical error and sincerely apologise to customers impacted.
“As Ofcom have stated today, the vast majority of funds reported were not overpaid. Only 6% - £2.4m - relates to money that was overpaid by customers.
“We identified the issue ourselves and notified our industry billing auditor. We have also taken proactive steps to refund all impacted customers for the extra charges they paid, plus an additional 4%.”
In calculating the fine, Ofcom took into account: the duration, scale and scope of the contravention; the significant degree of actual and potential harm; failures across senior management to prevent the billing mistakes; and the "absence of effective governance processes".
Ofcom's announcement concluded: "It is important that CPs take compliance with their regulatory responsibilities seriously. We strongly encourage all CPs to carefully review the findings of all our confirmation decisions to ensure that they put into place effective monitoring processes and compliance programmes."
Despite O2's cooperation in the investigation, it did not self-report the billing error to Ofcom and as a result a separate investigation into O2’s compliance with section 135 – the requirement to provide complete and accurate information upon request – remains ongoing.
