from The Times March 06, 2006 ..........


Small firms prey to telecom sales scams

By Gráinne Gilmore

ALMOST 60 per cent of small and medium-sized businesses (SMEs) have been approached by rogue telecoms salesmen in the past 12 months.

A survey by BT shows that attempted telecoms mis-selling has increased by 13 per cent since it last questioned small business owners in April last year. Nearly four in ten SMEs say that they receive an “apparently misleading or deceitful approach” from a telecoms company every two days.

A BT spokesman said that SMEs were targeted by rogue salesmen attracted by big profits. “A private customer will switch one or maybe two lines, but a small business could switch up to 100 lines,” he said.

Common tactics include salespeople misrepresenting which company they are calling from or giving misleading information about their service. The most extreme form of mis-selling is “slamming”, where customers find their telecoms account switched without their knowledge. About 15 per cent of businesses said that they had been locked into deals that they felt they had been mis-sold.

Last week Ofcom, the telecoms regulator, found Just Telecomms, which trades as Lo-Rate Telecom, guilty of breaches of industry rules on sales and marketing. The regulator said that the company had unfairly charged customers who changed their minds about switching providers within the ten-day cooling-off period.

Last year, complaints about mis-selling prompted Ofcom to strengthen the rules. All firms must now comply with a sales and marketing code and can be fined up to 10 per cent of turnover for breaching it.