Australia Targets $497M Consumer Complaint Logjam at Tech Giants

Australians filed 1,780 complaints about online retailers, marketplaces, search engines and social media platforms with the telecommunications industry ombudsman since the start of 2023. Complaints rose 20% in 2025 from the prior year. Account access problems led the list, followed by billing disputes. More than seven in ten complaints involved just five companies: Meta, Google, Microsoft, Apple and Hubbl.

The ombudsman cannot make binding decisions on these complaints. No existing dispute resolution scheme covers them. The Consumer Policy Research Centre found four in five Australians had a problem with a digital service in the past year. Unresolved issues cost an estimated $497 million annually, the research group said. Two in three who complained were left dissatisfied. Dissatisfaction hit 84% over refunds people believed they were entitled to. 83% centered on having no way to contact someone who could help.

The centre said when people complained to online businesses and platforms, many had to deal with virtual customer service portals and AI chatbots that are unhelpful, give no explanation or offer inaccurate advice.

Europe offers a template for reform. Under the Digital Services Act, platforms must run a proper complaints process where qualified staff, not machines alone, make decisions. Users can appeal to an independent government-certified body, which must rule within 90 days. Appeals Centre Europe has overturned more than three quarters of the original platform decisions across 1,500 disputes, the organisation reported.

British Columbia's Civil Resolution Tribunal uses a rules-based chatbot, the Solution Explorer, to guide people through questions before a human decision-maker steps in. Research published in the UNSW Law Journal compared rules-based chatbots with generative AI. The generative AI hallucinations invent legal rules and cases that do not exist, the researchers said. Even when it is not fabricating a source, it can produce convincing advice that is simply wrong. The error is invisible: told wrongly that you have no claim, you walk away and no feedback reaches the system that produced the error.

The Victorian Law Reform Commission recommended that AI must not make the final decision. A person must decide the outcome, the commission said in its report on AI in Victoria's courts.

For the five companies named in the complaints, the regulatory push carries direct cost. Redesigning customer service chatbots to include human oversight, handling escalated disputes through an independent body, and complying with any new ombudsman scheme will raise operational expenses. The government's scams prevention framework already requires banks, telcos and global digital platforms to join the Australian Financial Complaints Authority by September 1. That scheme is limited to scams, officials said. A new dispute resolution system for the broader range of platform complaints is still being designed.

The chatbots people are stuck in today are not broken. They are working exactly as designed for the online companies that built them, the Consumer Policy Research Centre said. Australia rarely gets to design a dispute resolution scheme from scratch. The September 1 deadline for the scams framework will be the first test of its ability to build one that works for the digital age.