Steve Pardoe's Cellnet Pages
Second Letter to the Office of Fair Trading
Logotype of Telecom Securicor Cellular Radio Limited
Cellnet are taking money from the credit card accounts of thousands of innocent people... ...even though they haven't got a Cellnet phone!
Office of Fair Trading
Field House, 15-25 Breams Buildings
Your ref 344739
CONSUMER CREDIT ACT 1974 and CELLNET
(Telecom Securicor Cellular Radio Limited)
Thank you for your letter of 17. May 1999, from which I gather that you are making our own enquiries into this matter. I had hoped to hear from you by now, as although your letter stated that the Office does not comment on the likelihood of action being taken, it seems reasonable to assume that if action is taken, the outcome will be made public. Please confirm that either your enquiries are continuing, or that they have reached a conclusion, in which case please let me know what it is.
To remind you, Cellnet are taking money, without authorisation, from the credit card and bank accounts of thousands of consumers who do not have any connection with Cellnet. These consumers are victims of fraud, owing to the lax and cynical manner in which Cellnet allow their customers to top up pre-pay mobile phones by keying in any credit or debit card number and expiry date, without requiring registration. This process lacks the protection which normally applies to "cardholder not present" transactions, and has been widely criticised. Cellnet, who claim to have sold over a million pre-pay phones, are the only cellular operator with such an insecure billing system.
As you should know, this matter has already been aired on BBC TVís "Watchdog", and Radio 4 "You and Yours" programmes. It has achieved wide publicity through my web site at www.pardoes.com/cellnet/ and has also been reported by "Which?" magazine, "The Independent" newspaper, "This is London", and elsewhere.
Cellnetís methods were recently criticised by the Association of Payment Clearing Services, which co-ordinates anti-fraud measures for the banking industry. Spokesman Richard Tyson-Davies said buying air time over the phone was often too easy and too little information was required from customers. "The situation is unsatisfactory," he said. "BT Cellnet is the main target for this kind of theft and I hope it will change its procedures to stop it happening."
It is still going on. Despite months of such adverse commentary, Cellnet persist in operating their insecure billing system, while maintaining that they have taken action to eliminate this form of fraud. This is simply not the case. When Cellnetís spokesman Mr Dave Massey appeared on the "You and Yours" programme on 6. July, he gave answers which were at best disingenuous, and in some cases plainly untruthful, including the statement that Cellnet were putting new security measures in place that week. Itís clear from recent correspondence, and my own research, that this has not been done, and Cellnetís system is as wide open to abuse as it has always been.
Itís unacceptable that a large organisation such as Cellnet should be permitted to continue to operate in such a disgraceful manner, which is clearly encouraging the defrauding and inconveniencing of many thousands of innocent people. Nor do I find it acceptable that their public statements should be so blatantly dishonest, and that they still refuse to apologise for, compensate for or prevent repetition of these thefts. One expects better of a major British plc.
Perhaps you donít appreciate just what a nuisance it is to find unauthorised debits on oneís card or bank statement, but I can assure you that it can lead to real financial loss and inconvenience, which is not compensated for by Cellnet. I have learned of cases in which over £1,000 was stolen in this way. It really has to be stopped.
Please review the updated material on my website, and let me have your comments by return. If you consider that the Office of Fair Trading does not have the power to act in this matter, kindly advise me to where I should turn instead. As you will see from my transcript of the BBC interviews at www.pardoes.com/cellnet/youyours.htm at least one Trading Standards Officer shares my concern that no-one seems willing to take on the case.
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