Aussie Wins 3-Year Legal Battle over Stolen Barcelona Phone Bill

We all know the theft of mobile phones is common in Barcelona; even the experts can fall victim. So it is disappointing to learn about retarded telcos who demand payment of huge roaming bills from customers who obviously did not make the calls listed on their statement. Australian provider TeleChoice has spent three years fighting with a customer who refused to pay an AUD191,000 (USD151,000) phone bill after his phone was stolen. But after three years of fighting, what did they achieve?

  • They lost the case.
  • They damaged their reputation due to the negative publicity.
  • They wasted money on legal fees and court costs by pursuing the case.
  • They wasted money on paying their own staff to pursue the case.

Put yourself in the shoes of the customer, Kim Beveridge. Per the Australian Broadcasting Corporation’s Law Report, Beveridge contacted his provider, TeleChoice, before traveling from Melbourne to Barcelona for Mobile World Congress.

He paid a bond to TeleChoice for the roaming service, which included a daily capped charge amount, and activated it on the way to the airport.

Alarm bells should be ringing already. What is the point of offering customers a cap on their charges if they can still be charged more than the cap after their phone is stolen?

…his phone was pickpocketed around 5:30am after a late night out with colleagues.

He called Australia the next day — roughly 20 hours later — and reported the theft.

“They had just notified me that they detected some suspect calls and suspect behaviour on my account, so they had blocked the account at that point,” Mr Beveridge said.

“I got home and a week or so after, I had a $191,000 bill land in my inbox.”

Suspect calls, suspect behavior? What level of suspicion is enough to attract the attention of TeleChoice?

In total, there were 4,484 calls amounting to 1,161 hours of conversation, and thousands more text messages.

1,161 hours of conversation during a 20-hour period? I think that counts as ‘suspicious’. But it is not just the telco who deserves criticism here.

Mr Beveridge contacted TeleChoice, who verified the bill and insisted he would have to pay the full amount.

He refused, and contacted the Telecommunications Industry Ombudsman. They said they could not assist with matters over $50,000, and advised Mr Beveridge to contact a lawyer.

What is the purpose of an ombudsman who protects customers except when they most need it?

The crooks who stole Beveridge’s phone were chiefly interested in the SIM card; this is normal for Barcelona phone crime. They put the SIM into another phone, then activated call forwarding to a number in Latvia, allowing them to make at least 38 multiple calls simultaneously. Telcos understand this scam better than their customers, and should be guarding against it. TeleChoice instead decided to hold Beveridge responsible.

TeleChoice pursued Mr Beveridge for the full amount, and the case wound up in the County Court of Victoria.

Nine months later, after the judge threatened to rule their pursuit of the $191,000 charge as unconscionable, TeleChoice reduced their claim to $34,000.

Mr Beveridge’s legal team’s defence centred on the terms of his contract with TeleChoice, challenging their entitlement to charge for call-forwarding on international roaming services.

In 2016, the County Court found in favour of Mr Beveridge, dismissing TeleChoice’s claim and ordering them to pay court costs.

Dissatisfied with the outcome, the telco took the case to the Victorian Supreme Court, dragging the legal battle on for another a year.

Finally last month, the Supreme Court of Victoria upheld the decision.

You do not need to know about Australian law to agree that justice was done. If telcos do not guard against such obviously criminal activity on their networks, why should they be allowed to demand compensation from a customer who was told he had capped his roaming bills? But TeleChoice still struggle to learn their lesson…

The Law Report contacted TeleChoice for comment but they declined, saying they are still considering their legal position.

You can hear the full story by listening to ABC’s Law Report and their interview of Kim Beveridge and his lawyer. The interview provides lots of fascinating detail, and is almost a case study in how telcos can screw up their contracts as well as their reputations. The show also helpfully contrasts the Australian experience with the way UK providers handle similar crimes.

Eric Priezkalns
Eric Priezkalns
Eric is a recognized expert on communications risk and assurance. He was Director of Risk Management for Qatar Telecom and has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and others.

Eric was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He was a founding member of Qatar's National Committee for Internet Safety and the first leader of the TM Forum's Enterprise Risk Management team. Eric currently sits on the committee of the Risk & Assurance Group, and is an editorial advisor to Black Swan. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.

Commsrisk is edited by Eric. Look here for more about Eric's history as editor.