Media Release: PIAC Applauds Competition Bureau Lawsuit for Premium Text Messages

OTTAWA – The Public Interest Advocacy Centre (PIAC) today welcomed the Competition Bureau’s demand that major Canadian wireless companies pay administrative monetary penalties for misleading advertising and repay consumers who have been victims of premium text messaging abuses.
“Consumers have complained for years of misleading advertisements for premium text messages that appear to provide a one-time service – for example a contest entry or quiz – but subscribe a consumer to a costly ongoing subscription service.” said John Lawford, Executive Director and General Counsel for PIAC.
The Competition Bureau’s lawsuit against Bell Canada (Bell), Rogers Communications Inc. (Rogers), TELUS Corporation (TELUS) and the Canadian Wireless Telecommunications Association (CWTA) seeks refunds of all consumer charges as well as $10 million maximum administrative monetary penalties from Bell, Rogers and TELUS for allowing premium rate text messages to be sent that offered consumers misleading services. The suit also seeks $1 million from CWTA industry association, which manages the premium text messaging system and an industry code.
“CWTA’s self-regulatory model for premium text messaging code is not adequate to protect consumers where advertisements are misleading or where terms and conditions are unclear to consumers,” noted Janet Lo, counsel at PIAC and author of the 2011 PIAC report “Paying a Premium: Consumers and Mobile Premium Services”. “Wireless service providers and the industry association have claimed for years that their self-regulatory code was sufficient to protect consumers from third party text messaging services, when in reality they have collected these charges and kept a share for themselves.”
Lo noted that consumers had suffered millions of dollars of unasked for and unwanted premium text messages charges for services that were hard to cancel and difficult to obtain refunds for, despite the CWTA code of conduct.
PIAC called in its 2011 report for an investigation by the Competition Bureau and other relief from the Canadian Radio-television and Telecommunications Commission (CRTC).
“The Competition Bureau has sent a clear signal that this is a major consumer problem and that it should be treated seriously by the wireless industry,” said Lawford.
Competition Bureau Media Release