Mobile phone "fat cats" have left 90,000 customers facing unexpected bills, a Birmingham MP has told Ministers.
Roger Godsiff (Lab Sparkbrook and Sparkhill, right) urged the Government to help customers who became victims of "dodgy business practices" as he led a debate on Dial a Mobile, a mobile phone shop in his constituency which closed last year.
The shop had more than 90,000 customers who signed deals with networks such as Orange, T-Mobile, O2, Vodaphone and 3.
Customers were offered "cash back" contracts, which meant they would get much of their money back after 12 or 18 months.
But the shop closed in August 2007, with debts of £12 million - leaving customers with expensive contracts which they now had to pay in full.
The mobile phone networks had employed bailiffs against customers who defaulted on their contracts, Mr Godsiff told MPs.
But the phone networks had encouraged shops to use cash-back deals - even though retailers risked going broke as a result, Mr Godsiff said.
"They are not interested in whether the retailer goes bust and cannot honour his obligations, because there will always be another retailer who is prepared to chance their arm.
"Once the retailer has linked the customer up to the MNO then the customer is - to use a fishing expression - hooked and netted and if the customer tries to escape then the MNOs send in the barristers and bailiffs!"
He added: "Ofcom, the telecoms watchdog, has launched an inquiry into how to stop these problems happening again.
"But this will not help the hundreds of thousands of people - including the 90,000 customers of Dial a Mobile - who are being pursued by the mobile network operators."
Mr Godsiff said he had approached the operators and asked them to allow his constituents to cancel their contracts.
But he said: "I acknowledge, in retrospect, that I was naive to think that 'fat cats' were going to give up even a drop of their milk and this has proven to be the case."
Lib Dem Trade Spokeswoman Lorely Burt, the MP for Solihull, warned that Dial a Mobile was always likely to suffer financial problems because its business model was unsustainable.
Malcolm Wicks, the Minister for Energy, said Mr Godsiff was "right to be concerned".