Fairfax Tech Column

Fairfax Tech Column

08.2.2019 Fairfax Tech Column 133


Those of you of a similar vintage to myself may remember Richard Pryor acting in Superman III. I remember Richard Pryor more for being a stand-up comedian than an actor in a series of movies starring Christopher Reeve, but I do remember his role in this movie.

Pryor plays the part of Gus Gorman, a computer programmer who embezzled money from his employer using a technique known as salami slicing. The concept is that if you take a very small amount (say, one cent) from a lot of accounts or transactions (say, tens of millions) you can make quite a nice income. There are various incidents in fiction and reality where salami slicing has been the preferred technique of those who like the idea of a get-rich-quick scheme.

You would think that by now, with the sophistication we have in AI and detection techniques, that it would be nigh impossible for someone to get away with a salami slicing scheme.

As much as they will deny it was a deliberate salami slicing technique, Optus has just been fined $10 million over a minor variation of the theme. This technique is called third-party billing.

The idea is that Optus allowed other companies to use the Optus billing system to sell games, ringtones and other digital content and bill the customers directly on their phone bill. Sounds convenient. Unfortunately, some of the third-party companies started billing customers when the customers were not explicitly aware of the fact they were being charged for a service or without realising that clicking on a text may be enough to add a small component to their bill.

The amounts being charged were typically small. Less than $3 for most of the services. Some of the billing providers hoped that, in the whole scheme of things, customers would not notice an extra $3 on their phone bill that may have totalled several hundred dollars. As with the salami slicing technique, it soon adds up. Optus customers were charged $195 million from 2012 to 2017. Some customers may have been aware they were being charged but the ACCC claimed Optus did not properly inform customers about a variety of aspects of the charges.

Why would Optus allow this to happen to their loyal customers? A small matter of $66 million in commissions earned through the process probably helped Optus glance the other way. So far Optus has refunded 240,000 customers a total of $8 million but that may just be the beginning. Optus received a total of 600,000 enquiries from customers over the five-year period.

The lesson here for the consumer? Check your bills. Not just your telecommunications bill but all of your bills. Your electricity, your gas, your rates. It may be a simple mistake or a disguised salami slicing scheme but it is your money. Find the time and have a look. You might save enough to buy more salami!

Mathew Dickerson