Telecommunications firm Virgin Media has been issued with a record penalty of £28 million by industry regulator Ofcom.

The sanction follows an investigation by Ofcom that uncovered what it described as a widespread and frequently intentional series of failures in how customer calls were managed, which created obstacles for subscribers seeking to end their contracts between January 2022 and September 2024.

Customers of Virgin Media experienced extended waiting periods, multiple transfers between agents, interrupted calls and requests to cancel that were not properly handled.

The company also attempted to dissuade customers from switching providers and failed to provide full cooperation during Ofcom’s inquiry. This represents a second breach, following a comparable financial penalty imposed in 2018.

Ofcom’s enforcement action comes after the regulator found that Virgin Media had established a two-tier structure within its customer retention department, with cancellation processing capabilities restricted to agents in the second tier. This arrangement forced customers to repeat their cancellation requests to additional staff members before their cases could be handled.

Some customers who grew frustrated with the process resorted to cancelling their direct debit arrangements, which subsequently had a negative effect on their credit ratings.

The investigation also revealed that Virgin Media operated a commission-based incentive scheme that rewarded employees for convincing customers not to cancel their services.

The financial penalty must be settled within the next two months and will be directed to the Treasury. Additionally, all customers who were affected must receive appropriate compensation or remediation within six months.

Ofcom stated that the penalty should act as a deterrent to other telecommunications providers operating in the market.

Natalie Black, Ofcom’s group director for infrastructure and connectivity, commented that the evidence demonstrated Virgin Media had made it more difficult for customers to exit their contracts and had not fully cooperated with the regulator’s investigation. She indicated that this represents the largest fine the organisation has issued under its consumer protection regulations for direct harm to consumers. She added that the action communicates clearly that providers who knowingly act against their customers’ interests will face substantial consequences.

The regulator initiated its investigation after receiving almost 2,000 complaints from Virgin Media customers regarding broadband, landline and television services who encountered problems when attempting to cancel their agreements.

Virgin Media, which combined operations with mobile network operator O2 in 2021 to create Virgin Media O2, has since restructured its customer service operations, implementing changes to its commission structures, staff training, quality assurance and monitoring procedures.

A company representative stated that Virgin Media is dedicated to delivering excellent service to all customers and expressed regret to those who encountered difficulties when getting in touch to negotiate new deals or terminate their contracts during the relevant period. The spokesperson explained that the company has comprehensively redesigned its customer service operations in recent years, addressing the historical deficiencies identified by Ofcom through various improvements, and has resolved all formal customer complaints from that time, providing appropriate redress where necessary. The representative noted that the customer service improvement strategy, supported by substantial investment, has produced transformative results, with Ofcom’s most recent data indicating that Virgin Media currently has the lowest complaint levels among broadband providers and that complaints specifically related to switching difficulties were 89 percent lower in the most recent year compared to 2023.