MP claims ‘conspiracy of silence’ over cashback

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Last month, Godsiff (pictured) asked Secretary of State for Business Enterprise and Regulatory Reform Pat McFadden how many former customers of defunct retail mobile phone companies had been threatened with court action by the networks, and as a result been given bad credit ratings or been referred to debt collection agencies.

McFadden responded such information was not readily available and to locate it would “incur disproportionate cost”.

Godsiff has issued a plea for networks to release such customers, and specifically those of collapsed Birmingham online retailer Dialamobile, from their contracts. Orange responded by saying affected customers had been allowed to downgrade to the cheapest available tariff.

Orange head of government policy and mobile regulation Simon Grossman wrote: “Orange has no involvement with these cashback agreements and the customer’s recourse is to the retailer, not Orange. The customer remains liable for the network agreement, which is entirely unaffected by cashback.

“Mobile operators cannot be expected to underwrite the debts of these companies by allowing affected customers to terminate their contracts early. This would only encourage these unsustainable business models.

“Also, a large number of early contract terminations would have a direct revenue impact on Orange of millions of pounds. We pay significant handset subsidies that can only be recouped if customers fulfil contractual obligations.”

Said Godsiff: “To say there is a conspiracy of silence regarding cashback is a woeful understatement. The networks are clearly sensitive about having their dirty washing in full public view.”

 

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