Carphone Warehouse attacks sledgehammer

ANOTHER ILLUSTRATION of the pressure that call centres in the UK telecommunications sector are under has just been supplied by the Carphone Warehouse. It's been fined to failing to send important insurance documents to telesales customers.

The UK's Financial Services Authority took a dim view of the fact that the Carphone Warehouse had known about the problem in March 2005 but waited until October 2005 to actually report it. Consequently the company was fined £245,000.

The problem is serious because it makes it very difficult for consumers to discover just what exactly they are covered for - particularly water damage to the handset which is very common.

Consumer groups have previously attacked insurance policies sold by specialists - such as the Carphone Warehouse - as being expensive. Particularly when many can simply extend their home insurance policies to provide adequate cover for much less.

The Carphone Warehouse's high profile CEO, Charles Dunstone, was far from being pleased with the FSA's decision. He described it as being "a bit like a sledgehammer to crack a nut."

According to the FT, however, Dunstone's firm hasn't lost its touch. The company received a 30 per cent discount on the fine by agreeing to pay it early.

Wonder if the Carphone Warehouse's customers can negotiate such a deal? µ