Telecom Italia under investigation for fraud in Brazil

Telecom Italia under investigation for fraud in Brazil

Telecom Italia’s Brazilian operation, TIM, is under investigation for possible fraud, amid allegations that it had been intentionally dropping customers' calls.

On Wednesday, Brazil’s communications minister, Paul Bernardo, called for regulators to speed up the investigation into allegations against Telecom Italia’s local mobile unit TIM.

The operator is specifically being accused of deliberately interrupting the calls made by mobile phone users paying per call rather than per minute on its “Infinity” service, between March and May 2012.

TIM said in a statement that it “vehemently denies” the allegations that it deliberately dropped customers' calls and that it had “identified serious processing errors which affected the information presented and lead to wrong conclusions” in regulator Anatel’s report.

Recently Anatel has been taking a hard line against mobile operators as Brazil tries to improve its telecoms services in preparation for the 2014 World Cup and 2016 Olympic Games.

In July three operators, TIM, Claro and Oi, were banned from selling new services in up to 19 of Brazil’s 27 states as punishment for poor service quality. This ban was lifted last week, after the three promised to invest $9.8 billion over the next two years.

On Monday, the southern Brazilian state of Paraná sought to restore the sale’s ban, and state prosecutors are seeking fines and repayment to some subscribers.

Latin America is considered a particularly crucial market for Telecom Italia due to declines in both its fixed and mobile businesses in Italy. Last week the company announced net profits of €1.2 billion in the first half of 2012 due to growth in Brazil and Argentina.

Gift this article