Ahmed, a lawyer for an Indigenous community legal service, approached the TIO about a debt-collection letter one of his clients had received about a $1,500 landline bill. His client, Nerida, lived with her young family on a remote community several hours drive from the nearest town.
Ahmed claimed Nerida had been contacted by a debt collector about a bill she had accrued over a four-month period. As well as being asked to pay the bill, her phone was disconnected and a default listing was placed on her file. Nerida’s service had since been reconnected so she could make and receive local calls only.
Upon investigation, the TIO was concerned that the provider had appeared not to have conducted a proper credit assessment before providing Nerida and her family with the landline service. Nerida’s only source of income was Centrelink payments, which were income managed. This meant that half her income was withheld to pay bills.
Nerida’s phone debt appeared to have occurred because of several hundred long distance and mobile calls. The Telecommunications Consumer Protections code says that providers must undertake an appropriate credit assessment to determine whether to supply a service to that customer or supply a service which includes measures to effectively limit the customer's expenditure or usage. In Nerida’s case, her service could have been limited to local calls to ensure she did not incur a high debt.
The provider said that it assessed all customers for their ability to pay their accounts, but could not provide any evidence that it had done so in Nerida’s case. It had listed her occupation when she applied for the service as unemployed.
Ahmed sought to have the total bill waived, have the default listing removed and keep the service restricted to local calls provided to Nerida and her family. The service provider declined, showing that it had followed the appropriate procedures before default listing Nerida. It said that Nerida had agreed, during the time that she was incurring high bills, to enter a payment arrangement. At this stage she owed $570, which the provider said she should now pay.
After further investigation by the TIO, the provider agreed to waive the whole debt, and withdraw the default listing. It said it would place a note on its systems so that if Nerida applied for a post-paid landline service again, she may be referred to a customer relations team for review to determine whether any restrictions could be placed on her service, to limit Nerida’s exposure to unexpectedly high bills.