Liability for charges following unauthorised transfer

Under Clause 8.1.3 (c) of the Telecommunications Consumer Protections (TPC) Code, a Gaining Supplier 'must take all reasonable steps to ensure that the person who authorises the Transfer is the Authorised Customer or their Authorised Representative.' Under Clauses 8.1.3 (d) and (e) of the TPC Code, a Gaining Supplier must 'obtain consent to a Transfer from the Authorised Customer or their Authorised Representative' and 'take all reasonable steps to ensure that the consent obtained is informed consent.'

When ascertaining whether there has been informed consent to a transfer, the TIO takes the view that the person who authorises the transfer needs to be the legal lessee of the service, or a person who is legally authorised by the legal lessee to act on their behalf, e.g. they hold power of attorney. This does not mean a person who is nominated by the legal lessee as their representative to access or make changes to an account from time to time. This is because the transfer of a service from one provider to another is not simply a change to an existing account but the setting up of a new contract between the gaining provider and the legal lessee.

Where a complainant disputes liability for call charges billed by the gaining provider, the TIO's view on the validity of charges depends on the reason for the transfer.

Where a transfer has occurred due to an administrative or system error (e.g. a data-entry error), and the customer took reasonable steps to address the problem as soon as they became aware of it, the TIO expects the gaining service provider to ensure the customer is no worse off as a result of an unauthorised transfer. That is, the TIO will expect the gaining service provider to adjust the customer's account if necessary to reflect the rates the customer would have received from their preferred provider. In other words, the customer must not be out of pocket.

Where a transfer has occurred as a result of a fraudulent or negligent act, i.e. the provider failed to take reasonable steps to ensure the transfer was authorised by the legitimate account holder, the TIO expects the gaining provider to waive any accounts issued. By way of example, the TIO will consider that the following situations fall into this category:

• the salesperson forged the customer's signature;
• the salesperson harassed or coerced the customer to sign the agreement;
• the salesperson misled the customer about what they were signing;
• someone other than the authorised customer authorised the transfer, i.e. someone other than the legal lessee or their legally authorised representative.

In all cases of unauthorised transfers, the TIO expects the customer to bring the matter to the attention of the gaining service provider as soon as practicable. Where the customer has unreasonably delayed in raising the matter and could have limited the amount of charges billed by the gaining service provider, the TIO may exercise its discretion not to investigate the complaint, or not to investigate the complaint further.

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