Excell Communications (Shropshire) has gone bust, leaving a trail of unpaid cashback claims estimated by the administrators to be between £600,000 and £1.3 million.
Angry creditors are besieging Orange demanding it honour the cashback contracts made with Excell Communications. Some creditors are accusing Orange of transgressing Ofcom’s General Condition 23 by failing to monitor Excell.
Orange is working with distributors Midland and HSC to address creditors’ concerns. The operator has also conducted an investigation into Excell Communications and other mobile resellers linked to Excell via former staff. Orange has issued ‘no deal’ notices to B2B Mobile, one of whose trading names is Wolves Mobile, and Premier Telesales, as a result of its investigations.
An Everything Everywhere (Orange) spokesman told Mobile: ‘A “do not deal” has been issued to B2B Mobile in December, which we expect to be applied to all of its subsidiaries. We have not issued a ‘do not deal’ to Wolves Mobile directly as we do not trade with them. However, we note that they currently advertise Orange tariffs and products on their website, which we will be asking them to remove.’
Former Excell MD Stuart Box, who sold the company to director Richard Taylor on 30 September last year, nine weeks before it went into administration on 6 December, is now head of B2B Mobile and its MVNO, Wolves Mobile.
Taylor is now MD of Premier Telesales, which also trades as Premier Phone Shop.
Begbies Traynor has been appointed as administrator for Excell Communications. It warned creditors this week: ‘Indications are that there are insufficient funds to make any payments to customers under any cashback agreements or transfer fees from previous airtime providers and any monies owed to [creditors] will be lost.’
Meanwhile, Midland Communications said it was ‘extremely disappointed with the actions of Excell Communications’, adding that it is offering advice and support to Excell customers.
HSC said it was honouring all Excell connections made via the distributor.
However, angry creditors said the measures were not enough. Former Excell customer David Hoe said: ‘Orange failed to observe its responsibilities under General Condition 23. I am taking legal advice.’
Orange refuted creditors’ claims. A spokesman said: ‘Orange has been very proactive in addressing any issues, including cutting off over 100 dealers who did not meet the high levels of customer service we demand from our dealers.
‘We ensure that all our partners are aware of the regulations set out by Ofcom’s General Condition 23 when selling to customers and that they are aware of their obligations within this regulation, which includes ensuring cashback terms and conditions are fair and made clear at point of sale.’
Stuart Box told Mobile: ‘I left Excell after 18 months away for personal reasons. There is no connection between me leaving and the company going into administration, I could not have known that the main distributor would withdraw their support to the new owner following my departure (that being the motivating factor in the company’s administration); not least since the new owner had run the business in my absence during that 18 month period.
‘The administration of Excell has had a devastating effect on both me and my family, and I have every sympathy for those that have lost money as a result. I myself am a large creditor of Excell and hold several personal guarantees against the business. The administration of that company, therefore, has significant ongoing financial implications for me and my family as well.’