“Loyalty penalties” legal claim could cost mobile operators £3bn
A former Citizens Advice executive has launched a legal claim against mobile networks seeking £3bn in damages for millions of UK customers.
Justin Gutman says the four biggest operators charged customers “loyalty penalties” after their contract terms ended and are owed thousands of pounds in compensation.
Gutman believes more than 28m UK mobile phone contracts were affected dating back to 2007.
The penalties were charged despite customers having completed their minimum contract term of 24 months and their smartphones having been paid for.
The claim filed by Gutman is for 4.8 million people who could receive roughly £1,800 if they had a contract with one of the big four operators.
Gutman is seeking certification for the claim, and he admits it might take a “year or two”, or even longer, for it to be settled.
EE hit back by stating that the legal claim is “speculative”.
A spokesperson for the company said: “We strongly disagree with the speculative claim being brought against us.
“EE offers a range of tariffs and a robust process for dealing with end-of-contract notifications.”
Meanwhile, O2 and Vodafone said their legal teams didn’t have enough information to assess the claim.
O2 added that it was aware that consumers can overpay for devices they own and campaigned on the issue in May.
Jack Drury from St Albans said he paid an expensive tariff three years after paying off the debt for his mobile device.