CHANNEL 4 admitted yesterday that problems with the Richard and Judy competition You Say We Pay dated back to 2004 - two years earlier than thought - as it said it was axing all profit- making phone-in competitions.
The broadcaster may have to pay out £2.2 million to viewers after the discovery they had been misled on the Richard and Judy quiz for so long.
The decision to scrap profits on its phone lines will also have big financial repercussions for Channel
4 - the group expected to make £3 million from such activities this year.
In its statement, the broadcaster said an internal report had also found early entrants to the Deal or No Deal phone-in competition had had a greater chance of being shortlisted than later entrants.
Channel 4 originally offered to refund viewers hit by the You Say We Pay fiasco on the Richard and Judy teatime show between June 2006 and February 2007. It said last month there was no evidence to suggest the problem dated back three years, although the operator, Eckoh UK, said it was happening when it took over the contract in September 2004.
But yesterday Channel 4 said 2.9 million calls to the competition had no chance of winning, and that £2.2 million had been generated from "improperly entered calls" between September 2004 and February 2007.
The revelation of phone irregularities on Richard and Judy sparked the disclosure of a number of similar cases affecting not only Channel 4 but also ITV, Five and the BBC.
The allegations extended to popular shows such as BBC's Saturday Kitchen and ITV's X-Factor and Ant and Dec's Saturday Night Takeaway. Even the BBC's Blue Peter was drawn into the row over trust on TV after it emerged a competition winner had been faked.
Channel 4 has now axed all its premium rate telephone services, with the exception of that on Deal or No Deal, and it will donate its share of future profits from that to charity. It will still use phone voting on Big Brother but charge only enough to cover the cost of the call.
Last year, there were about 30 premium-rate phone competitions in and around shows on Channel 4 and its sister channels. The group's forecast profit for 2007 from such competitions was about £3 million.
Yesterday's decision affects some of the broadcaster's most popular programmes, including the Paul O'Grady Show, which will return in September without a premium-rate competition. All other such competitions have already been halted.
Anne Bulford, Channel 4's group finance director, said: "We've previously taken the view that premium-rate competitions were a legitimate activity, given the demand from viewers to take part. But public trust in these competitions has been severely undermined and we do not want to risk further our relationship with our viewers."
She said of the Richard and Judy competition: "The investigation has uncovered no evidence that anyone at Channel 4 had any knowledge of or involvement in the improper handling of viewer calls.
"From the moment it came to our attention, the channel has done everything possible to protect viewers' interests, including having all competitions audited on a live and ongoing basis by appropriate third parties.
"Our priority now is to ensure all affected viewers have the chance to claim a full refund as previously promised. We will donate all our profit from improperly entered calls, which is not claimed and refunded, to charity."
Channel 4 launched its investigation after it emerged viewers were being invited to enter the Richard and Judy competition after the shortlist was closed. The 2.9 million wasted calls represented 42 per cent of the total.
Channel 4 said its total profit was £300,000, and that it would donate any remaining profits to charity following the refund process. This means that if only £50,000 is claimed in refunds, £250,000 will be paid to the Great Ormond Street Hospital Children's Charity.
• ITV has launched a formal inquiry into its documentary about the death of Alzheimer's patient Malcolm Pointon after the film-maker, Paul Watson, claimed the channel had refused his request to make clear the programme did not show Mr Pointon taking his final breath.
The full article contains 714 words and appears in The Scotsman newspaper.
