ACCC accuses mobile phone company Excite Mobile of concocting fake debt collector to hunt customers

The South Australian-based mobile phone company Excite Mobile Pty Ltd stands accused of pressuring customers for payments through a fictional independent debt collector, and telling customers their assets – including children’s toys – could be repossessed if they didn’t pay their bills.

In a wide-ranging case by the Australian Competition and Consumer Commission, the mobile phone service provider is accused of sending letters to almost 1,100 customers that purported to come from an independent debt collector Jerry Hastings. It is also alleged to have set up a fake independent complaints tribunal.

The ACCC alleges the letters came from Excite Mobile, and contained false representations about the mobile phone company’s rights if it chose to take legal action against the customer.

In particular, the ACCC is taking aim at warnings customers may face a fee of up to 20% if they did not pay their bills on time.

Customers were also warned their assets, including children’s toys, could be repossessed.

The letters included comments such as: “(My lawyer) is saying lets drag you in to court and start repossessing your assets under Australian law.”

“You know things like your stereo, TVs, cars and games systems. Anything of value to you will become ours.”

Other comments include advising customers to pay off their bills in small instalments – a “small price to pay to stop people coming into your house (and) ripping the TV out”.

“Look to be truthful the law is on our side. Asking for the full amount and NOW is allowed by the law. But nobody wants the make lawyers and judges get richer.”

“Getting things repossessed is not only devastating. But it is also embarrassing in front of family, friends and co-workers.”

ACCC also alleges Excite sold contracts for residents living in areas with no mobile phone coverage, and acting unconscionably in its sales methods to induce customers to enter into a 24-month contract.

The ACCC is seeking injunctions, pecuniary penalties, orders that two directors be disqualified from managing a corporation for five years and costs.

A directions hearing has been set for January 13 in the Federal Court in Adelaide.

Comment was sought by the number provided in the Jerry Hastings letters but the number had been disconnected.

The case comes as the number of complaints against the telco industry soared 18% to a record high this year, driven by Vodafone’s network issues.

Complaints to the Telecommunications Industry Ombudsman centred on customer service, complaint handling and payments.