In recent years, it has become common, in the business phone industry, for predatory telecom companies to present amazing phone deals to businesses promising a great price and service, only for the businesses to be left in a 7-year contract with a lease deal they were not even aware of.
How does it happen?
Predatory telecoms sales reps will usually present a solution that ticks all the boxes for a business, highlighting the low monthly costs whilst conveniently avoiding any mention of the terms and conditions. This, combined with the pushy sales tactics employed by these companies, means that in the spur of the moment, many business owners sign up thinking they have got a great deal without knowing what is in the small print.
What do the contracts really say?
The contracts used by these telecoms firms usually have a small print section which contains two major points. The first is a lease agreement, which during a recent BBC undercover investigation here: ‘I feel sick about signing that phone contract’ – BBC News identified salesmen outright denying a lease agreement in the contract when there clearly was one. This usually results in an additional charge above that of the contract for leasing the hardware itself, so the second you receive the phones you are locked into the agreement and paying much more than you ever realised. Many businesses reporting this have tried to get out of the contract. However, there is no regulatory body and businesses are not covered by consumer laws which means there is no cooling-off period. Many have to stick it out until the contract ends, which is where the second major point of these contracts kicks in. The contract terms tend to be 5 or 7-years and including a 72-hour cancellation period. This means you must notify if you do not wish to continue the contract otherwise it will automatically renew for another 7 years.
The predatory nature of these companies and the extremely long contract periods are not designed to keep customers but to roll in money for the operators. It is for this reason they rarely invest into their products or quality of support meaning they will provide the bare minimum to satisfy the contract.
How do I avoid this from happening to me?
The best way to avoid being trapped in a contract like this is to always get a second opinion. Many of the sales tactics deployed by these salespeople are designed to get you to sign right then. Some of our customers have even reported salesmen bringing along a portable printer to modify and re-print the contract there and then to complete the deal.
The next best thing to do is always cross-check what you are being told with what is written down. This may sound like a simple solution but in many circumstances when you are busy or have a feeling of trust in what you are being told it can be easy to assume you have heard everything you need to know to be satisfied.
I think I’ve been scammed, what can I do?
Unfortunately, with a lack of official bodies governing the operation of these lease deals, and Ofcom not going after these companies, you may be locked in for the term. Not all is lost if you think you have been scammed. There have been several cases over the years where the scammers have been brought to justice. In 2011, there was a large case where scammers were pretending to be a business arm of BT and signing up businesses into large lease deals, read more about that here: https://www.bbc.co.uk/news/business-15579974
If you would like free advice with no commitments or pressure, MF Telecom Services Ltd is more than happy to go over any contracts you have been given or offer our advice regardless of whether you are our customer.
