Virgin Media fined £28m for obstructing customer cancellations
Ofcom has levied its largest-ever consumer protection fine against Virgin Media after finding its commission structures incentivised agents to trap customers in contracts, exposing a costly governance failure at the broadband provider.
Virgin Media has been ordered to pay £28m after the UK communications regulator found the company systematically prevented customers from canceling their contracts over a near three-year period. Ofcom determined that millions of calls were likely mishandled between January 2022 and September 2024. The penalty, which must be paid to the Treasury within two months, is the largest Ofcom has ever issued under its consumer protection rules.
The regulator uncovered a two-tier retention system where only select agents could process cancellations, forcing over a million callers to repeat their requests. Agents deliberately hung up on customers, subjected them to excessive hold times, and aggressively pressured them to stay. Ofcom found that Virgin Media’s commission scheme financially rewarded staff for this behaviour, pointing to a fundamental misalignment between internal incentives and regulatory compliance.
This obstruction forced consumers to remain on more expensive tariffs rather than switching to competitors. Ofcom received 1,881 direct complaints, with some customers resorting to canceling direct debits, which risked damaging their credit scores. Natalie Black, Ofcom's group director for infrastructure and connectivity, noted the company initially resisted informal resolution in 2022 and "did not fully cooperate" with the subsequent investigation.
The fine was reduced by 30% because Virgin Media admitted the failings and agreed to settle. The company must now verify within six months that all complaining customers received appropriate compensation. A Virgin Media spokesperson said the provider has "completely redesigned" its customer service operations, overhauled its commission structures, and invested heavily in a turnaround strategy.
For investors, the fine adds to a pattern of costly regulatory breaches. Virgin Media was hit with a separate £23.8m penalty earlier in 2025 for leaving customers without access to lifesaving telecare alarms during a digital switchover. Taken together, these penalties signal persistent execution risks in the company's operational infrastructure.
The company is attempting to reassure the market that these historic governance flaws are fixed. Virgin Media cited Ofcom's latest data showing it is now the "least-complained-about broadband provider," noting that complaints specifically regarding "difficulties leaving" dropped 89% last year compared to 2023. The introduction of Ofcom's "One Touch Switch" process in 2024 also removes much of the friction providers can historically exploit, potentially limiting future liability.
