An investigation by the telecoms regulator, Ofcom, found Plusnet had overcharged 1,025 customers more than £500,000 in total for landline or broadband services they had previously cancelled.

Once a customer cancels their home phone or broadband service, providers’ billing systems must recognise that the line is ‘ceased’ but an error in Plusnet’s billing system meant the cancelled lines were recognised as ‘live’.

Plusnet, a BT-owned company, continued to bill these customers during 26 May 2011 and 3 September 2015. It discovered the error during a routine audit and subsequently contacted Ofcom to alert it about the mistake.

Ofcom has today fined Plusnet a total of £880,000 and Lindsey Fussell, Ofcom’s consumer group director, said this fine serves as a reminder that firms must adhere to billing rules: “There can be no margin for error, and no excuses, when it comes to billing customers correctly,” she said.

To date, following an initial letter in February 2016 and a follow-up letter sent in May 2016 in addition to phone calls to previous customers, Plusnet has refunded 356 customers a total of £212,140, which included interest at a rate of 4%.

The remaining funds from customers it could not reach have been donated to a dozen local charities but if any customers believe they may have been overcharged, they should call Plusnet on 0845 1400 082 where a member of the team will “check, and honour, any applicable refund”. Ofcom added that since 29 July 2016, no further customers have contacted Plusnet about a refund.

‘We are very sorry’

A Plusnet spokesperson said: “We are very sorry and would like to apologise to the 1,025 customers affected. We reported this ourselves to Ofcom, and made every effort to contact these customers to arrange a full refund before the investigation started. We would also like to reassure all customers this was an isolated historic issue and we have implemented a number of new robust measures to make sure this doesn’t happen again.”