TelstraClear settles after admitting fair trading breach

TelstraClear has settled with the Commerce Commission after admitting breaching the Fair Trading Act over unauthorised switching of customers to its accounts.

The commission said today TelstraClear had agreed to change its approach to telemarketing and accept outside auditing of its compliance with the Act.

A commission investigation found that TelstraClear had switched customers to its network without their consent in a practice known as "unauthorised switching".

TelstraClear, a unit of Australian phone giant Telstra, has contacted all customers who complained and credited their accounts or closed them with no outstanding balance.

It has also changed its approach to telemarketing and customer complaints, and is working with an industry body to develop codes around customer transfer and consumer complaints, the commission said.

"We are satisfied the changes put in place by TelstraClear address our concerns about unauthorised switching," said commission director of Fair Trading, Deborah Battell.

She said switching companies was a critical competition issue in utility markets.

"Unauthorised switching takes the power of choice away from consumers, and that undermines competition.

"Consumers need to have confidence that they can switch companies when they want to, and won't be switched when they don't want to," she said.

The Commission began investigating after complaints from the public and following complaints to television's Fair Go programme.

- NZPA