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Vodafone fesses up to “burner phone” prepaid problem


Vodafone Store

1,028 people signed up for prepaid plans without their identities being confirmed.

Vodafone has promised to improve its identity verification processes for people signing up for prepaid phone plans after an Australian Communications and Media Authority (ACMA) investigation revealed that the telco had regularly signed up new customers without sufficiently confirming their identities, due to a shoddy IT implementation.

The carrier has signed an enforceable undertaking with ACMA to make sure it improves its processes around confirming customer identities. "Verifying the identity of prepaid mobile customers helps law enforcement and national security agencies obtain accurate information about the identity of customers for the purposes of their investigations," ACMA acting chair James Cameron said in a statement announcing the undertaking.

Prepaid SIMs are often used for "burner phones" and anonymous communications, but in Australia, all carriers need to verify the identity of anyone signing up for a mobile service.

According to ACMA, the breaches occurred throughout 2016 and involved a total of 1,028 customers. The problem was that customers could sign up online for plans and click a button confirming their identities had been verified in a Vodafone store, but there were no checks that this was actually the case.

As a result of the undertaking, Vodafone will update its systems, improve training and conduct audits every six months.

The rules for verifying identity for phone customers were updated in April 2017 to allow a wider range of credit cards to be used for the process.

ACMA has been ramping up its consumer protection activities in recent months. In December, it introduced new rules to help dissatisfied NBN customers.

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Picture: Tooykrub/Shutterstock

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