Telstra billing system purge complaints soar

Telstra's $600 million fire sale of allegedly bad debt has again returned to haunt it. Complaints to the Telecommunications Industry Ombudsman (TIO) have soared to another all-time high.

Figures released today by the TIO show 2398 complaints related to telco credit control in the three months from June 2003 to September 2003, a significant increase of 281 from the previous quarter. Complaints are up a massive 1101 from September 2002.

"More than 1600 were related to the debt recovery practices of providers, their agents and more recently, debt recovery companies to whom telephone debts have been sold Telecommunications Ombudsman, John Pinnock, said.

While complaint breakdowns by carrier will not be available until December, a spokesperson for the TIO said the rapid escalation of complaints seemed directly connected to the sale of Telstra's $600 million debt to collection agencies Baycorp Advantage and Receivables Management Group (RMG).

Baycorp has been reeling ever since the purchase of the debt. There have been several board level resignations and it recently scrubbed more than $4.6 million worth of book value from the Telstra debt ledger.

Market analysts agree that Baycorp substantially overpaid for the debt at the time.

Both Telstra and Baycorp refuse to divulge what, if any, data grooming or duplicate reconciliation the companies engaged in prior to the sale.

Baycorp is also the owner of the former Credit Reference Agency (CRA), which determines the worthiness of credit applications.

Computerworld understands that the jurisdiction of the TIO was not factored into the sale of the debt, resulting in telco customers being blacklisted by Baycorp while debt was still in dispute.

This move has clearly annoyed the TIO, particularly as Telstra is a member of the TIO council.

"People were being put on the credit default register without even being able to sight a bill" a spokesman for the TIO told Computerworld. In a move likely to add more cost burden the collection agencies, the TIO is recommending people approached by telcos, or their recovery agents, check the age of any claimed debt, and ask for a copy of the original itemised bill. The TIO adds that in most states, the statute of limitations on debt is six years, after which it becomes uncollectable. The cost to the TIO of determining complaints is billed directly back to the individual telcos from whence they came.

In July 2003, the Australian Communications Authority explicitly prohibited the on-selling of disputed debt under the Australian Communications Industry Forum (ACIF) C541: 2003 Credit Management Industry Code.

The ACA has conceded Telstra "would have been aware" such changes were afoot when it sold its $600 million debt to Baycorp and RMG.

A Telstra spokesperson said that the timing of the sale of the debt was "pure coincidence".

He said the decisions were made by "quite separate arms of the company".

The spokesperson added that Telstra "was very concerned about every complaint" with the TIO and hoped that the complaint numbers would soon abate.

"We accept it is a Telstra problem" the spokesperson said.

Join the newsletter!

Or

Sign up to gain exclusive access to email subscriptions, event invitations, competitions, giveaways, and much more.

Membership is free, and your security and privacy remain protected. View our privacy policy before signing up.

Error: Please check your email address.
Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Julian Bajkowski

Computerworld
Show Comments

Brand Post

Most Popular Reviews

Latest Articles

Resources

PCW Evaluation Team

Luke Hill

MSI GT75 TITAN

I need power and lots of it. As a Front End Web developer anything less just won’t cut it which is why the MSI GT75 is an outstanding laptop for me. It’s a sleek and futuristic looking, high quality, beast that has a touch of sci-fi flare about it.

Emily Tyson

MSI GE63 Raider

If you’re looking to invest in your next work horse laptop for work or home use, you can’t go wrong with the MSI GE63.

Laura Johnston

MSI GS65 Stealth Thin

If you can afford the price tag, it is well worth the money. It out performs any other laptop I have tried for gaming, and the transportable design and incredible display also make it ideal for work.

Andrew Teoh

Brother MFC-L9570CDW Multifunction Printer

Touch screen visibility and operation was great and easy to navigate. Each menu and sub-menu was in an understandable order and category

Louise Coady

Brother MFC-L9570CDW Multifunction Printer

The printer was convenient, produced clear and vibrant images and was very easy to use

Edwina Hargreaves

WD My Cloud Home

I would recommend this device for families and small businesses who want one safe place to store all their important digital content and a way to easily share it with friends, family, business partners, or customers.

Featured Content

Product Launch Showcase

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?