We investigate: premium-rate phone lines

Premium-rate phone lines generate enormous income for companies. They are used to sell goods and services and the cost is charged to phone bills and pre-pay phone accounts.

Services range from content and services for mobile phones, to telephone voting so viewers can interact with their favourite TV programmes.

According to analyst Frost and Sullivan, revenue in Europe was €2.68bn last year. In the UK alone nearly £1bn was spent on phone-paid-for content and services.

But as consumers have found out to their cost, this market is littered with companies whose practices are, to say the least, dubious.

Common complaints include the practice of surreptitiously signing people up to expensive subscription services for ringtones or games that drain mobile phone accounts.

More recently we have seen the fiascos surrounding competitions and voting call lines run by broadcasters such as the BBC and ITV.

So who should consumers complain to if they feel they have been ripped off?

Ofcom and Phonepayplus
Under the Communications Act 2003, Ofcom is the statutory communications regulator that has overall responsibility for the regulation of premium rate services (PRS).

However, Ofcom decided in December 2007 that an independent regulator, Phonepayplus, would act as the agency that carries out the day-to-day regulation of the PRS market on its behalf.

Phonepayplus was set up in 1986 as Icstis by the telecommunications industry to protect consumers from unfair trading practices.

It does not receive any Government funding and the money to run the agency comes from a levy on service providers (companies that sell services or content). This is collected by network operators such as BT and O2.

From time to time its income is supplemented by money from bank interest and fines or administrative charges collected from service providers who breach Phonepayplus' Code of Practice (CoP).