SYDNEY--Singapore Telecommunications-owned Optus has agreed to a US$65 million penalty in its latest run-in with Australian regulators, admitting that it sold unsuitable products to vulnerable individuals, including Indigenous Australians.

Optus admitted its staff acted unconscionably in relation to allegations by Australia's consumer watchdog that the company had pushed goods and services onto consumers that did not want or need them, or who could not use or afford them.

Those targeted included consumers with mental disabilities or learning difficulties, the Australian Competition and Consumer Commission said Wednesday. Others had limited financial literacy or were not fluent in English, the regulator said.

Optus has agreed to pay a penalty of 100 million Australian dollars and to remediate affected customers. The penalty is subject to court approval, the ACCC said.

This marks the latest blow to Optus's reputation, following a series of high-profile incidents. In 2022, customer details were stolen in a data breach that triggered an investigation by Australia's communications regulator and a class action in the country's federal court.

The following year, Optus's network collapsed following a software upgrade at its parent company. Millions of customers, including hospitals and government departments, were left without service for hours.

The outage and Optus's response led to the November 2023 resignation of CEO Kelly Bayer Rosmarin, tougher industry rules on emergency call provision, and a A$12 million penalty.

Regarding Optus's sales practices, the ACCC said Wednesday that Optus had engaged debt collectors to pursue customers even after management had begun investigating staff behavior.

"Many of these consumers who were vulnerable or experiencing disadvantage also experienced significant financial harm," said ACCC Deputy Chair Catriona Lowe.

"They accrued thousands of dollars of unexpected debt and some were pursued by debt collectors, in some instances for years."

In one case cited by the ACCC, a First Nations consumer living in an area without network coverage was pressured by staff into entering a store under the impression that they were being offered a free phone.

Instead, they were contracted for two high-end phones and other services at a minimum two-year cost of A$3,808, the ACCC said. They were sold additional items the next day and eventually pursued by a debt collector over charges they did not understand, the regulator said.

Optus said it had dismissed some employees and overhauled staff incentive structures in response to the conduct, which the ACCC said occurred between August 2019 and July 2023.

"Optus failed these customers and the company should have acted more quickly when the misconduct was first reported," said Stephen Rue, who served as Optus CEO since November 2024.

"We will hold ourselves to a higher standard going forward."

Write to Stuart Condie at stuart.condie@wsj.com

(END) Dow Jones Newswires

June 17, 2025 23:15 ET (03:15 GMT)

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