"They Promised Free Phone Upgrades, But It Was All Lies... The Trap of 'Free' That Hurt Seniors"

Survey of Mobile Phone Stores in Jeonnam and Jeonbuk by Korea Consumer Agency
Consumer Relief Cases Up 20.7% Year-on-Year from January to April This Year
84.8% of Damages Related to 'Contract Termination'... Only 46.1% of Disputes Resolved

There has been a growing number of cases in which customers suffer damages after signing up for services at mobile phone stores based on explanations such as free device replacements or low-cost plans, only to find that the actual contract terms differ from what was promised.

According to a joint survey released on July 22 by the Korea Consumer Agency, Jeollanam-do, and Jeonbuk Special Self-Governing Province on the state of offline advertising at mobile phone stores in Jeonnam and Jeonbuk?regions with a high proportion of elderly residents?the number of consumer relief cases related to mobile phone services over the past five years reached a total of 4,100.

The number of cases was 910 in 2022, 816 in 2023, and 768 last year, showing a yearly decrease. However, 333 cases were reported from January to April this year, representing a 20.7% increase compared to the same period last year. Notably, cases involving consumers aged 65 or older accounted for 14.5% (596 cases) of the total, and the number of such cases received by April this year was 39, up 39.3% from the previous year.

On the 7th, when the government approved the partial amendment of the Enforcement Decree of the Act on the Improvement of Distribution Structure of Mobile Communication Terminals (Terminal Distribution Act) at the Cabinet meeting, a banner related to mobile phone discounts was hung at a mobile phone store in Seoul. Photo by Kang Jinhyung aymsdream@

The most common reason for seeking consumer relief was damages related to 'contract termination,' such as discrepancies between the device price or monthly usage fee explained at the time of contract and the actual contract terms, accounting for 84.8% of cases. In particular, for elderly consumers, contract termination-related damages accounted for 90.1% of cases, making up the overwhelming majority.

By sales type, 'general sales,' where consumers visit the store in person to sign a contract, accounted for more than half at 53.3% (2,187 cases). For elderly consumers, damages from general sales were 73% (435 cases), which is 19.7 percentage points higher than the overall rate.

Among the outcomes of damages, only 46.1% of cases were resolved through agreement, such as 'refund' (12.8%) or 'contract cancellation' (9.6%), falling short of half.

Meanwhile, a survey of offline advertising at 518 mobile phone stores in the Jeonnam and Jeonbuk regions found that 18.9% (98 stores) were engaged in unfair advertising. Typical examples included advertising device prices as 'free' or 'at no cost' when this was not the case (10.2%), and promoting 'lowest price' claims without objective evidence (10.2%).

A representative from the Korea Consumer Agency stated, "With the repeal of the Act on the Improvement of Distribution Structure of Mobile Communication Terminals (Terminal Distribution Act) on July 22, competition among stores is expected to intensify, which is likely to increase damages, especially for elderly consumers. Therefore, caution is needed." The representative also urged consumers "not to be misled by advertising phrases such as 'free,' 'at no cost,' or 'lowest price,' and to carefully compare the final purchase price, including the installment principal, when buying a device."

This content was produced with the assistance of AI translation services.