Telstra has been fined millions of dollars and ordered to pay millions more in compensation for misleading almost 9000 customers on its budget internet provider.

The Federal Court has slapped the country’s biggest telco with an $18 million fine for moving 8897 Belong customers onto a lower-speed NBN plan in late 2020 without telling them.

While the new plan had the same maximum download speed, the maximum upload speed was halved from 40 to 20Mbps.

On top of the fine, Telstra has been ordered to repay $15 to each customer for every month they were on the lower speed plan – a total compensation of more than $2.3 million for the telco.

“The $18 million penalty sends a strong message to all businesses that they cannot mislead consumers by making changes to key aspects of a service without informing customers of those changes,” ACCC Commissioner Anna Brakey said.

“Telstra’s failure to inform customers that their broadband service had been changed denied them the opportunity to decide whether the changed service was suitable for their needs.

“Misleading pricing and claims in relation to essential services, with a particular focus on telecommunications, is one of ACCC’s current enforcement priorities.”

The ACCC had taken Telstra to court in December 2022 over the incident, and the Federal Court found in February of this year that it had breached consumer law

The telco was ordered to pay part of the consumer watchdog’s legal costs.

Belong was launched by Telstra in 2013 as its low-cost internet and mobile provider.