The fine is the latest in a long string of recent punishments from ICSTIS and media regulator Ofcom over fake, rigged and misleading competitions.
ICSTIS (the Independent Committee for the Supervision of Standards of the Telephone Information Services) found that a viewer competition run as part of Deal Or No Deal was misleading and did not provide every entrant with an equal chance of winning. The competition was run by iTouch, which was fined £30,000.
In the competition viewers are shown three sealed boxes containing three different amounts of money. They are told that they can enter the competition to win one of the three cash amounts. The fact that the programme is pre-recorded and the competition run live, though, means that the cash amount to be won is by necessity pre-determined. ICSTIS ruled the competition to be misleading for this reason.
"At the point of calling viewers will consider that any one of the three amounts is available to be won and will enter the competition on this basis," said the ICSTIS ruling. "However, as the show is pre-recorded, at the time when the invitation to call takes place, the programme makers are already aware of which cash prize will be won."
"Therefore, whilst viewers are entering to win any one of the three cash prizes, in reality the winning amount has already been selected. For these reasons, it was the opinion of the Executive that a breach of this paragraph of the Code had occurred," it said.
ICSTIS can only fine the service provider responsible to it for the use of a premium rate phone line, which is why iTouch and not Channel 4 was fined.
ICSTIS also found that the competition was not equally open to all entrants. It said that callers near the beginning of the show were more likely to win the competition than callers at the end.
"The winner selection process which had been used, as detailed by the service provider, meant that each entrant did not have the same chance of winning, to a significant degree," said the ruling. "A fundamental requirement for this type of competition was that each entrant had an equal chance of being selected. This had not been the case due to the way the winner selection process had occurred, making the competition intrinsically unfair."
Channel 4 said that it had previously checked its presentation of the prizes in three boxes with ICSTIS officials and had received approval for that presentation method.
“We are surprised the promotion of prizes on the competition has been ruled to be misleading," said a Channel 4 spokesman. "The channel took legal advice that reassured us of its compliance with the ICSTIS code of practice and earlier this year, before the ICSTIS investigation began, we discussed the mechanics of the competition with senior staff at ICSTIS who assured us that they were comfortable with the manner and circumstances in which the prizes were referred to."
ICSTIS said that the problems with the competition cause moderate consumer harm and issued iTouch with a formal reprimand as well as the fine.
The judgment follows months a large number of revelations in recent months that the operators of competitions on television have been cheating viewers. Revelations began when viewers of Channel 4's Richard and Judy programme were found to be being encourage to enter a competition when they had no chance of winning.
Channel 4 has said that it has stopped all its profit making telephone lines except that of the coming series of Deal Or No Deal, which will have a premium rate competition whose profits will go to charity.