Which?: Cashback mobile phones a rip-off

Thursday, 20 December 2007 12:00

Consumer watchdog Which? has attacked cashback mobile phone offers, branding them a "rip-off" and calling for the schemes to be banned.

The deals, where customers pay upfront for a handset and contract and then claim some or all of their money back over a period of time, have been popularised this year by retailers.

But the schemes are often highly-dubious according to the organisation.

After receiving thousands of complaints from consumers who were unable to claim their cashback Which? launched an investigation into the contracts and found many were misleading.

The most common misdemeanour committed by retailers was making it 'extraordinarily-difficult' to claim cashback.

Other providers simply went bust, leaving contract holders out of pocket.

"We think mobile phone cashback deals that make customers jump through hoops to get their money should be banned. If cashback is offered, it should be automatic," said which.co.uk editor, Malcolm Coles.

"Thousands of people have already lost money through these dodgy deals, so don't touch them with a bargepole. Ring in the new year with a cheap mobile phone deal that doesn't include cashback."

In response to concerns over the issue, five mobile phone networks (O2, Vodafone, 3, Orange and T-Mobile) established a voluntary code of practice, endorsed by the regulator Ofcom, to reduce the number of people missing out on their cashback.

However, in October, which.co.uk checked ten mobile phone dealers' websites and found the offers on six breached the code.

When informed of the findings only O2 and Orange said they would make changes immediately, while Vodafone said its terms would not have changed yet because the code was still in its "infancy".

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