MOBILE phone users in East Lancashire have been left thousands of pounds out of pocket following the collapse of a West Midlands telecoms dealer.

Consumer watchdogs have recorded 50 complaints from people over Birmingham-based Dialamobile.

Trading Standards said the firm offered customers the chance to buy one phone and get a second free.

Dialamobile staff also secured the customer contracts with other mobile phone providers with the promise that it would pay the £440 line rental fee and also give £40 cash back, Trading Standards said.

But customers are counting the cost after the firm, which also had an online sales operation, closed its Bordesley Green shop in the city.

Some customers have lost up to £1,000 - and been told that they must honour the mobile phone contracts.

One customer in Blackburn secured more than 50 contracts for family and friends and is facing a bill of £15,000.

Chris Allen, head of Blackburn with Darwen trading standards, said: "This has been a popular scheme which has been promoted by word of mouth among families and friends. That's why some people have taken out more than one contract.

"It was initially offered by Mobile Connections, but the company was taken over by Dialamobile earlier this year.

"Dialamobile told customers their monthly cashback and line rental fee would be paid every three months in future, but is now saying that cashbacks will not be honoured at the moment. It also closed its shop in Birmingham last week."

Customers have been told to contact Trading Standards if they have concerns over their original contracts - but the consumer protection service says it has no powers to intervene.

Mr Allen added: "Customers are still tied into a contract with Orange or T Mobile as service providers and must pay what they owe for the line rental and call costs, whether or not they receive any cashback money."

Customers are being advised to contact their phone provider and ask for extra time to pay, if necessary. People in dire straits are also being referred to the council's money advice service.

Mr Allen said: "We would always urge consumers to be wary of cashback deals for any product or service as they can end up facing unexpected costs if something goes wrong."

People with concerns about Dialamobile are being asked to contact trading standards on 0845 404 0506.