The Australian Communications and Media Authority has given a provider of SMS-based psychic advice services, Crystal’s Gifted Psychics Pty Ltd, a formal direction to comply with rules designed to safeguard users of mobile premium services.

’This formal direction is the first action taken by the ACMA against a provider of a mobile premium service for breaching industry rules introduced in July 2009,’ said ACMA Chairman, Chris Chapman.

’The direction is a warning to providers of mobile premium services who fail to provide the required safeguards, that the ACMA remains serious about industry addressing misconduct.’

An ACMA investigation into the premium SMS psychic advice service operated by Crystal’s Gifted Psychics Pty Ltd found that it breached obligations under the Mobile Premium Services Code. The ACMA found the company failed to clearly and legibly include its consumer helpline in its advertising and register with the industry body, Communications Alliance, prior to supplying a mobile premium service to the public.

While a direction to comply is the strongest action available to the ACMA in response to a breach of an obligation under an industry code developed under the Telecommunications Act, the ACMA may request the Federal Court to impose penalties of up to $250,000 if a direction to comply is contravened.

Since the introduction of the new code in July last year, the ACMA has been monitoring and auditing individual services to identify shoddy practices, and has currently underway a further 16 investigations. Activities such as these, combined with the tough rules under the code, are having an effect: complaint issues recorded by the Telecommunications Industry Ombudsman about mobile premium services have fallen by 56 per cent in the period since the new rules were introduced.

The report of the ACMA's investigation and the direction to comply can be found on the ACMA website.

Background material on mobile premium services and tips to avoid problems with them can also be on the ACMA website.