Mobile phone fraud: “Bill Shock”
“Bill shock” - that’s the term the mobile phone industry uses when you receive a bill that’s unexpectedly high. One of the most common reasons is that someone has stolen your phone and run up the bill at your expense. But will the network provider excuse these charges?
Published 10 October 2012:
When Rob received a bill-shock he found that he had no support from his network provider. He usually spends around £50 a month with Orange but after his phone was stolen he received a bill for nearly twenty five times that amount.
The person who had stolen Rob’s phone had run up the bill calling places like Algeria and France but his network provider, Orange, were holding him responsible for the calls.
Although Rob had never made calls to Algeria before Orange failed to spot the unusual activity on his account. He’s just one mobile user successfully targeted by fraudsters.
“The fraud will take place within hours of the loss of your SIM card or phone and they will carry on exploiting the use of that until they get stopped” says Simon Collins a Mobile Fraud expert.
Traditionally thieves have made money by simply selling stolen phones on to someone else but increasingly organised gangs set up premium rate phone lines - then use stolen phones to call those premium numbers repeatedly.
This new type of mobile phone fraud makes the fraudsters huge amounts of money and unlike banks who take the financial hit for fraudulent transactions on your debit card, mobile network providers are not legally liable.
The mobile phone companies claim they try to minimise the chances of customers receiving a shock bill. Orange and Vodafone informed us they only charge for calls that are made before they’re informed of a theft.
With this in mind managing to actually speak to the mobile company to report the theft is not always that simple.
When Rob experienced the theft he immediately tried to call Orange and was on hold for around 20 minutes. Over the next few weeks he made several attempts to call Orange but never managed to get through because of the length of time he was kept on hold.
Situations like this can become more problematic when the theft happens outside of the UK.
Susan usually spends £30 a month with Vodafone. Susan’s SIM card was stolen while she was on holiday in a remote part of the Philippines. She was unable to call Vodafone and when she tried to make contact via the internet the website was down and couldn’t let her log in. Susan decided to contact them via their web form.
When Vodafone replied to Susan’s message they did not acknowledge that her phone had indeed been stolen. They advised her that they would replace the SIM card for £5 but she had to go to her local Vodafone store to pick it up.
Vodafone later claimed they didn’t receive Susan’s web form, even though they had replied to it.
For Susan the news was bad as the thieves went on to run up £1500 worth of charges and the bill was all hers to pay.
Lori an O2 customer received a shock bill after her mobile was stolen in South Africa. The total bill racked up to an astonishing £5628.
She was unsuccessful when she tried to get in touch with O2 and so went to report the incident at a police station. Despite this, O2 insist that Lori is still liable for the charges because she didn’t report the theft to them until she was back in the UK.
Like the other mobile phone companies O2 do have systems to monitor unusual usage like this. So why didn’t they take action to stop it?
“When you are roaming in a different country, you need to realise that the data takes some time to come back from that country to your home network for them to analyse the data and to review it. Unlike a credit card which is authorized at the point of sale which may take one or two minutes to do if your abroad, in the mobile phone industry we allow calls to take place first and then look at the data afterwards.” says Simon Collins, Mobile Fraud expert.
Despite the clear evidence that Lori’s excessive charges were run up after she reported the theft to the police, O2 haven’t stopped pursuing her for the payment of the charges. Although they reduced the charges by half, they have since added on early disconnection fees and legal costs, not forgetting the debt recovery letters.
With phone theft increasing, the mobile phone companies are coming under pressure to reduce so-called ‘bill shock’ - but considering the highlighted cases the chances of this happening soon appear slim.
A Vodafone spokesperson says,
Vodafone did not have any contact from Ms Wilkins until we received an email from her reporting the loss of her SIM card on 27 February. Our response to her, dated 29 February, reminded her that she could replace the SIM in store. It also confirmed that a bar had been placed on the SIM.
Meanwhile, on 28 February, before we had actioned Ms Wilkins’ email, we had registered unusual usage on the line and sent text messages to both lines on the account. In response to one of the texts, Ms Wilkins’ daughter phoned us to say a bar should be placed. Unfortunately, our adviser was quite wrong to say we needed to speak to the account holder. Any third party can act on the account holder’s behalf in these circumstances. This has been addressed with the individual concerned.
In her conversation with us on 23 April, Ms Wilkins said that she thought that the SIM was stolen on 22 February. Her first contact with us was the email dated 27 February which means the SIM was subject to fraudulent usage for five days. Customers should tell us as soon as they become aware that a mobile device or SIM is lost or stolen and we will take responsibility for any voice or data charges between the notification from the customer and a bar being placed on the device. Until that time, the customer is entirely responsible for any calls made, or data used, as we have no way of knowing whether these calls were made legitimately.
Having looked at this case again, it seems clear to us that Ms Wilkins should not be liable for any charges after she completed and sent her ‘contact us’ email to us on 27 February at 6.50. This reduces the charges by £293.39. In recognition that Ms Wilkins’ daughter received the wrong information from our adviser we would like to further reduce the bill by £128.41 leaving a total outstanding of £1000.
We are pleased to confirm that we have now been able to resolve this matter with Ms Wilkins, and have agreed a further 20% reduction to her bill. While Ms Wilkins has confirmed that she did not contact us for some days after the loss, we do acknowledge there was a degree of confusion. We have also agreed a payment plan with her. Her total bill is now £800.
An Orange spokesperson says,
“At Orange we have robust systems in place to protect our customers from fraud and our dedicated team will in many cases identify stolen handsets before the customer notifies us. We of course advise customers to treat their phones as they would their wallets and notify us immediately if they have been the victim of theft. We also urge customers to make full use of the security PIN on their handset to protect their personal information and help prevent unauthorised use. We sympathise with Mr Weetman’s situation and have offered a resolution.”
An O2 spokesperson says,
Even though we have detection measures in place and are able to bar phones that we suspect have been stolen, this is not a substitute for customers contacting us as soon as they notice their phone is missing. Our Help & Support section is clearly visible on the home page of our website and includes details of how to get in touch if customers are overseas.
We have fully investigated Ms Parson’s account and can confirm that we proactively blocked her mobile phone on 22 February after receiving the usage records from the South African network. The usage records gave us reason to believe that her mobile phone had been lost or stolen.
Despite our contact numbers being clearly visible on our website (including a number to call when overseas) the first contact we had with Ms Parson’s was on 5 March when she called to request a new SIM card. She then contacted us again on 26 March to dispute the amount of the bill that was issued on 20 March and, in light of the circumstances, we applied a 50% discount to her bill.
As a gesture of goodwill we have now cleared Ms Parson’s account of any outstanding amount and we apologise for any inconvenience this may have caused her.