Two major mobile phone contractors in the UK have been fined by Ofcom, the UK's communications regulator, for overcharging customers trying to leave their contracts early.

Over 400,000 EE customers and 82,000 Virgin Media customers paid a total of £4.3m and £2.8m, respectively. Although companies can charge customers a fee for leaving before the minimum terms of their contract, these charges were not made clear and resulted in customers being less likely to switch to one of EE or Virgin's competitors - breaking Ofcom's rules as a result.

Gaucho Rasmussen, Ofcom’s Director of Investigations and Enforcement, said: “EE and Virgin Media broke our rules by overcharging people who ended their contracts early. Those people were left out of pocket, and the charges amounted to millions of pounds .

“That is unacceptable. These fines send a clear message to all phone and broadband firms that they must play by the rules, in the interests of their customers.”

Over the past six years, 15m EE discount contracts for mobile, landline, and broadband packages had hidden, excessive, charges. Virgin, meanwhile, charged early exit fees that were significantly higher than customers had agreed to when signing up to its contracts. The majority of its customers were overcharged by £34, while 6,800 customers were charged more than £100 in penalties.

Ofcom fined EE £6.3m, with the company refunding £2.7m to the affected customers it can identify (although Ofcom says this means "up to £1.6m cannot be refunded.") Virgin Media was fined £7m, plus an additional £25,000 for failing to provide full information when questioned by Ofcom.

Virgin Media has refunded, or made charity donations, to account for 99.8% of the customers that have been affected. However, the company remains displeased, as the BBC reports that it "strongly disagrees" with the decision and would be appealing to the Competition Appeal Tribunal.

Chief Executive of Virgin Media Tom Mockridge said that, "This decision and fine is not justified, proportionate or reasonable. A small percentage of customers were charged an incorrect amount when they ended one or more of their services early and for that we are very sorry."