Word Search competition run in The Sun newspaper by Churchcastle Limited
Today Churchcastle was fined £800,000 by the regulator Phonepayplus for breaking the premium phone rate rules.
If you entered you can get your money back. Many phone calls cost £10 each.
Last December I wrote about Churchcastle's Word Search competitions. My 90 year old relative was bombarded with letters from Churchcastle claiming she was one phone call away from a very large cash prize after she entered a word search contest advertised in the Sun. I complained to the telephone regulator Phonepayplus in November 2011, but they told me the adverts complied with all their rules.
Today Phonepayplus has had a change of mind. They have announced a record £800,000 fine for Churchcastle's misleading competitions which scammed mainly pensioners who are over 80 years old. Apparently Phonepayplus recieved 15 complaints. My complaint wasn't counted, because they told me back then there was nothing wrong.
All complaints related to elderly consumers, the majority of whom were over 80 years old, and were made by concerned relatives. The complainants raised a number of concerns regarding the size, visibility and readability of the pricing information, “bill shock”, misleading promotions (including the poor quality of jewellery items) and the large volume of highly personalised direct mail marketing promotions. In addition, a number of complainants stated that in their opinion the Service took advantage of elderly people who were vulnerable because of their age. Executive monitoring of the Service supported the concerns raised by complainants.
The Executive raised the following potential breaches of the PhonepayPlus Code of Practice (12th Edition) (the “Code”).
• Rule 2.3.10 - Vulnerable groups
• Rule 2.2.5 - Pricing
• Rule 2.3.2 - Misleading
• Paragraph 4.2.4 - Conceal or falsify information
Part of the Adjudication published by Phonepayplus today
It's a shame Phonepayplus didn't act faster. Last year Churchcastle, based in St Leonards On Sea, East Sussex, but which is ultimately owned by an American company Worldwind, reported profits of £3,000,000. Yes three million pounds! So a £800,000 fine is just a drop in the ocean for their owner.
When I heard news of the record fine on Radio 4's Today programme this morning I emailed the Chief Executive, Paul Whiteing, at Phonepayplus immediately. I complained that Phonepayplus didn't think there was anything wrong with these competitions when I contacted them 11 months ago. To his credit he emailed back straightaway to say they had looked more carefully at these competitions, and at the elderly readers they were targetted at.
Their Chief Executive went on to reassure me he would be writing to all the newspapers and magazines that carried Churchcastle's Word Search adverts so that readers who had entered could now claim a full refund.
The Tribunal upheld the breaches. The Level 2 provider’s revenue in relation to the Service was within the range of Band 1 (£500,000+). The Tribunal considered the case to be very serious and issued a formal reprimand, a direction to remedy the breaches, a fine of £800,000 and a requirement that the Level 2 provider must refund all complainants who claim a refund, for the full amount spent by them on the Service, within 28 days of their claim, save where there is good cause to believe that such claims are not valid, and provide evidence to PhonepayPlus that such refunds have been made.
Phonepayplus has instructed Churchcastle to make full refunds
If you manage to get a refund please let everyone know by posting your story in the comments section below.
Incidentally the Sun was very helpful last year when I complained to them. They instructed Churchcastle to refund my relative to the tune of £120.51. I phoned my relative this morning too tell her the good news - she is delighted other people may get back their pension money too.