/ Technology

We need protection for fraudulent spending on stolen mobiles

Woman on phone

If your credit card’s stolen and used, you’re not liable for fraudulent spending. But if the same happens to your mobile phone, it’s down to you to foot the bill. Isn’t it time mobile operators took some responsibility?

You’re a responsible person who takes care of your belongings. You cover your PIN at cash machines, keep valuables out of sight, and always report any losses as soon as you can.

But, despite your best efforts, you discover your mobile phone’s gone walkabout. After a vain search, you report the loss to your operator who say they’ll block your phone to prevent further fraudulent use.

But what about any fraudulent use that’s already occurred? Chances are it hasn’t been more than a day or so since you last used it – but how much damage can have been done?

Sadly, lots. Thieves can run up bills of thousands of pounds in just a few days. Constant and relentless use of your phone for overseas or premium rate calls, heavy internet use and smartphone app purchases can all add up to a massive bill in a surprisingly short time.

Credit cards are covered better

If this story was about your credit card, as long as you hadn’t been negligent, you’d be liable for – at most – £50 of fraudulent spending.

Possibly because of this, most credit card providers are vigilant to unusual use – sometimes almost excessively so. Mine has checked for ‘unusual use’ simply because I made three purchases within an hour – none of which exceeded £10.

But I’d much rather overcaution than an apparent complete lack of interest or responsibility, which is what many mobile users experience. If you’re pushy enough, mobile operators will sometimes waive part of the bill – but legally, they have no liability to cover any of it.

Take action when your phone’s stolen

Apart from keeping a close eye on our phones, there are a few precautions we can take. Some operators let you block access to premium rate services or overseas calls, so this is worth checking. And many modern smartphones have apps or services that let you put your own block on your mobile being used if you misplace it or it’s stolen.

And always report your phone missing to your operator as soon as you realise – even if, as some victims have experienced, a stranger lets you know they’ve found it and will return it to you. They could very well be the one who stole it and are trying to prevent you blocking it.

It seems massively unjust that the customer’s responsible for the full cost of fraudulent use, especially if the use is out of character, they haven’t been negligent and have reported the loss as soon as possible.

I think mobile operators could – and should – take some responsibility too. When I’ve asked mobile operators about it in the past, they usually argue that it’s technically problematic to flag atypical use quickly – there’s too much of a time lag between real-time use and it showing up on their systems.

And even if it was technically possible, some reckon that many people would be frustrated to find their phone blocked just because they used it differently to normal.

But a workable system to flag up atypical use shouldn’t be beyond these giants of technology. And I’m certain that if mobile network regulator Ofcom made operators liable for fraudulent costs, such a solution would be miraculously speedy to materialise.



I had my old mobile cloned – the cloner ran up a bill for £91 – The mobile company paid it and replaced the analogue phone for a digital one free,

I now have a “Pay as you go” tariff – so the maximum the thief could use is £10 – how could a thief run up a huge bill if your tariff is say £15 a month?

Pay as you go seems the only safe solution, but then users are being robbed by service providers charging high rates for calls.

In all honesty I only use a mobile for emergency calls only – All other calls are made by my Virgin Land-line which gives free 01 02 and 03 calls after 6pm – My phone bill is around £3 a month.

AnnoyedDad says:
1 April 2011

Having just seen my daughter be liable for £150s of calls made between phone loss and reporting it, I have done some thinking and calling:
1) The winner in this is the service provider as they get paid for the nice juicy calls.
2) Expenditure limits (with advance warnings, user validation and overrides and whatever) and unusual call activity monitoring is not exactly difficult to implement with computers. OK it won’t catch all calls, but a £20 excess is a lot better than a £150, £1000 or whatever.
3) Any systems that provide the features in “2” could be optional to avoid negate arguments by nay-sayers who think they might cause problems with legitimate use.
4) [thus] The providers would seem to be preferring their own profit margins rather than their users costs. In fact I wonder to what extent you could argue this is deliberate.

Ofcom tell me they have no powers to enforce any such requirement on the providers. This is referred to by them as “bill shock”, but they are thinking about it. If you talk to them and say that you think they are therefore deficient in their powers this will be noted and used when they consider what to do – so call them (oddly their website doesn’t seem to have any mention of this topic, see http://consumers.ofcom.org.uk/tell-us/telecoms/).

The other advice Ofcom gave me was to write to the provider saying that you would like a refund as you would expect them to recognise the the unusual cost and pattern of calling and thus verify the user’s identify and/or cap the use. If/When they refuse then you can ask the OTELO ombudsman (01925 430049) to take the case up on your behalf.

Pressure must be applied – call Ofcom and tell them they should have the power to enforce this.

Although I agree (see above) that Pay As You Go is a solution, it is also more expensive, so it is not ideal, or even feasible if you’ve just started a new contract.

Louise says:
21 February 2014

It is not technically difficult to flag unusual usage, I worked for a phone company 20 years ago and we got computerised notification of unusual usage pdq, only problems were when that usage occurred over weekends and there was no one at work to deal. It used to be a lot dearer to call abroad back then and call selling was rife, especially in the northwest.

Annoyed parents says:
19 June 2011

Our son currently lives and works in Vietnam. About 3 mths ago he had his wallet stolen but hadn’t realised it contained his English SIM card. The theft has just come to light and he owes Orange nearly £700. Talk about atypical use! Calls from Vietnam when the phone hasn’t been used for the previous 18mths, and then only from England. He is naturally very shocked and upset and just as mentioned above says why on earth couldn’t Orange flag it up? And why on earth was it allowed to run on for so long? We are all agreed that the mobile phone companies should take some responsibility as the credit card companies do.

janine james says:
15 December 2011

I was on holiday in South Africa last week and had my phone stolen from my handbag. Sadly I didn’t notice till the following morning. The thief called premium rate numbers ALL night and I now have a roaming bill of £2972!!
Surely the provider- O2 could quickly tell this was very, very atypical activity on my account (I have NEVER called a South African premium rate number during12 years with O2) and acted swiftly to block this and / or cap the charges? Why is it that the banks can track unusual activity right away and put a handy stop on your credit/debit cards but the phone providers just seem to be ignoring this huge injustice??

Beth says:
15 January 2013

I’ve just been hit with a £2000 phone bill from Orange. My phone was stolen on the Saturday night and I have no landline or internet access at home so had to wait until I got to work on Monday before being able to block the phone. Does any one have any advice about how to appeal this bill?

Many thanks,