Ofcom said Plusnet, a BT owned company, has been fined £880,000 for continuing to bill more than a thousand ex-customers.

The UK-based telecoms provider charged for landline and broadband services after customers had cancelled. An investigation by Ofcom found that more than 1,000 ex-customers were overcharged by more than £500,000 in total.

Ofcom said 1,025 customers who had cancelled either their landline or broadband service continued to be billed, meaning they were overcharged by more than £500,000 in total.

Lindsey Fussell, Ofcom’s Consumer Group Director, said: “There can be no margin for error, and no excuses, when it comes to billing customers correctly.”

Plusnet has made repeated attempts to refund all affected ex-customers by letter and by phone. It has refunded 356 customers a total of £212,140, which included interest at a rate of 4 percent for each customer.

The investigation showed that Plusnet breached Ofcom’s important billing rules – General Condition 11.1 PDF, 449.4 KB, which is designed to ensure customers are charged correctly for the services they receive.

Plusnet discovered its billing error, whilst undertaking a routine asset reconciliation exercise of its customer base and identified a customer as having a chargeable account but with no active telephone of broadband service.

Once a customer cancels his or her home phone or broadband service, telecoms providers’ billing systems must recognize that the line is ‘ceased’. In this case, an error in Plusnet’s billing system meant that cancelled lines were still recognised as ‘live’.