Thanks for the comments. I should point out that while my ideal outcome would be to have the Default removed and that would have settled the matter , the fact that Vodafone see their action as reasonable is alarming to be honest. It is their behaviour I am hoping to challenge and have reviewed regardless of whether the outcome removes my personal Default. I believe I do have to first of all establish who handles this complaint. I am involving my MP on this point as it is unclear and in particular the grey area around Telecoms companies not being handled by the FSA or potentially the ICO as these are possibly not Credit Agreements. I also believe the question of Vodafone using these Default notices to restrict a Customers ability to move to another provider is relevant and worthy of investigation. It is quite clear from the ICO guidelines (accepting that I have still to determine if they are even relevant) that a credit file is intended to reflect a Customers Credit Worthiness and in that event I believe it is relevant that if Vodafone did take me on as a new customer they did not see me as a credit risk. Yet they have posted a record on my file to indicate to other Mobile Providers that I may be. The bottom line here is that even if Vodafone acted within the guidelines then putting a Default on someones Credit File after 3 Months over £25 is unreasonable. It prevents any ex Vodafone Customer from moving to another provider for 6 years. Yet Vodafone will accept these Customers back on to their own network.

As it happens I came across an old Debt Agency bill form O2 from a while back ( I returned the phone they said they didnt get it etc) and that had gone on for 6 months but no Default. In the end they found the phone but at least I didn't have the further complication of getting my credit file updated. I'm just amazed any company would use something as serious as a Default for a balance of £25 and register within 3 Months of the amount falling due. I don't think even a Bank / Mortgage Provider would do that so there has to be some motive in their doing it.

Just as an update to this post. Lee has helpfully investigated the issue but they have concluded the Default is fair and maintain their position. My position is the Default is unreasonable in line with the guidelines published by the Information Commisioner. In addition, Vodafone taking this action while still accepting me as a new CUstomer on a higher value contract represents a conflict of interest. A default is supposed to represent their opinion of my Credit Worthiness but how can a company record a default AND take me on as a new customer on a higher value contract. To re-iterate this Default has prevented me moving to a new provider and was lodged only 3 Months after a missed payment AFTER the end of an 18 Month contract where I still maintain I was told by the agent there would be no more to pay. THis is the first Default I have lodged against my name and is now causing me untold problems (despite being for only £25!!). I have anecdotal evidence from firends who use other providers they have missed payments in the past but never had this action taken against them. I will keep pursuing this matter with the Information Cmmmisioner, my MP , the FSA AND other Mobile providers who may be unaware Vodafone are carrying out this process and will carry a great deal more influence than me if there is any wrong doing. In the meantime let this serve as a warning to other customers. Vodafone will happily ruin your credit file for 6 years for a balance of £25.

I came across ICO documentation posted elsewhere on this forum - I can't post the link yet but you do a search on "ICO Default guidelines" you should find it. Page 3 Item 4 already interesting: It is an accepted industry standard to record only serious ‘defaults’ with credit reference agencies And Also P6 Item 11 Time Framework Accounts should not be routinely filed as being in default where full payments or those due under a rescheduled agreement are fewer than three consecutive months in arrears. Accounts should normally be filed as being in default where those payments due have not been received for six months Now I think it is stretching things to argue anything under £50 is a serious default and particularly when it is applied within 3 months of the missed payment. It does seem there are guidelines to protect consumers but VF are not adhering to them. Also the opening section of this documentation again makes reference to credit companies input into these guidelines. I am really not sure Mobile Companies should be issuing defaults as has been point out. Certainly not if they are ignoring industry accepted practices on the matter.

RS - and it was a good rant. I agree and I think the biggest problems is that these defaults push otherwise good paying customers on to much higher interest rates often with products from subsidiaries of the same lender. A Credit File is there to let Lenders make decisions on someones ability and likely hood to pay. Given the sensitivity of the information lenders have a responsibility to use it responsibly and it's clear some are not. One missed payment at the end of a 2 year contract resulted in a £25 default for a mobile broadband contract and I can't get a car loan. It's incredible. I'm awaiting the outcome of my own issue with Vodafone and the next step is to write to my MP. There is a good website that makes this simple to do (theyworkforyou.com). I don't have much faith in the FSA . Any other suggestions welcome.

2Grumpy I have to agree. While I appreciate Vodafone have been pro active on here that fact that they have issued a default in my case within 3 months of a missed payment and made it very difficult to pay suggest they are using a Customers Credit file as a way of enforcement - completely by passing any court process or any potential dispute over the amount etc. Given that so many mobile phone customers are young and just starting out on the financial ladder they could find themselves frozen out of the credit market for 6 years for the smallest of balances. It would be unlikely any court would issue such a harsh punishment. Central to this seems to be that Mobile Companies (and energy companies) do not have to issue a Notice of Default as Credit Companies are forced to do and it would appear anyway they have realised this loophole and starting to abuse it.

Lee, Thanks for your response I appreciate you cannot deal with specifics on here. But again it is worth mentioning that repeated attempts to settle the balance with Vodafone were met with resistance form the Debt Team there telling me it had to be paid to the Debt Recovery company. When I explained I did not have the details of the Debt Company they said they didn't have them either. They said they were unable to accept any payment. Again this all happened in the space of 3 months after 21 Months of perfect payment and my only "crime" was cancelling the Direct Debit a few days early (though I am convinced I was told the account would stop after 30 days). It was only when I called to reinstate my service (and was told it would be better to start a new one) that miraculously I was able to pay off the outstanding balance of £25 on the previous account. I appreciate you are investigating the specifics of this case but I am adding the additional information here in case other customers have noticed the same behaviour.

Lee. I think it's very useful and commendable that you / vodafone are taking time to monitor these complaints. However a little more research does reveal Mobile Companies are in a very privelaged position over other Credit Companies in that they do not have to issue a notice of default. This allows them to act far more quickly with no notice to the customer. From my own experience it seems Vodafone policy is to record a default against a customer within 3 months of a missed payment regardless of amount or circumstance. So for a £25 outstanding amount a customer will have their Credit File affected for 6 years. Having had outstanding balances with other mobile companies (usually their own billing errors) they just do not act as swiftly Vodafones policy is not doing them any favours. I'm not just bashing Vodafone here - I happen to think their Customer Service is way ahead of others with a far more reliable mobile broadband product but something has to be done about an over zealous debt department that are very difficult to deal with. They are operating on the very edge of the law in my opinion.

I have just discovered a similar problem with Vodafone and just logged my problem with the form referenced in this thread (5881861). Hopefully something can be sorted out - it would seem that Vodafone are very quick to lodge a default and perhaps don't realise the consequences this can have. In my case this is partly my own fault - I called to cancel but must have cancelled the Direct Debit too early (though still not convinced this is the case). Ironically I am still an active paying customer of Vodafone as I was accepted on a new contract with them and only discovered the outstanding amount when I called to start a new contract. The problem only came to light when I was turned down for a store card and checking my credit file online revealed the problem. My Credit Score has gone from 900 or so to 600 in a month. This is the first default I have ever had registered against me and while I perhaps must accept some blame for the oversight it does seem an abuse of the credit file system that my punishment is now 6 years with no credit for missing one payment in 2 years. One further point on this. I was recently turned down for a contract with 02 as a result of this default. Yet a few weeks later accepted with a contract on Vodafone. So by placing this default Vodafone prevented me from moving to another provider but they allowed me back on to their network. I don't think this is what the Credit Checking system was intended to be used for! I will let you know the outcome of my request but many thanks to the original poster and for the link to the form. At least I'm not alone.