Vodafone Ireland has admitted a second instance of overcharging customers. More than 550,000 users of its wireless internet service WAP paid a total of €2.65 million in excess of what they should have, due to a glitch in the billing process.

The error emerged during a review of all tariffs by Ireland's largest mobile phone operator following an earlier instance of overcharging.

Vodafone said the overcharging amounted to an average of €4.79 per customer affected. Almost half of those overcharged were overcharged by amounts of less than €1, the company said in a statement.

The telecoms regulator, ComReg, said it was dismayed at the revelation. "ComReg is disappointed that the processes in place at the time were neither robust enough nor accurate enough to prevent this sort of issue arising," said ComReg chairman Mr John Doherty.

He noted that the disclosure came during the review of billing systems ordered by the regulator after several instances of overcharging came to light in July.

Vodafone admitted then that it had charged more than 22,000 customers almost €150,000 in roaming charges for calls made while overseas.

That followed an admission by rival mobile operator, O2, that it had overcharged more than 10 per cent of its customers over a period of several months. Eircom has since acknowledged that it, too, charged customers more than it was entitled to for certain services.

Vodafone has apologised for the latest setback and said all customer accounts affected would be recompensed within 48 hours.

The company said it would contact all customers affected by text or letter. It will also pay compensation amounting to 10 per cent of the overcharged amount.

The company said the mistake occurred when tariffs were changed on its WAP service. That is understood to have happened about 18 months ago.

"It is an unfortunate fact of commercial life that human errors can occur in the course of manually inputting into systems," Vodafone Ireland chief executive Mr Paul Donovan said. "However, if we make mistakes, we are committed to fully addressing them and putting them right."

A spokeswoman said the WAP tariff system at the heart of the current disclosure was complicated with some internet pages being charged by the page and others according to the amount of information downloaded.

Vodafone engaged PricewaterhouseCoopers to identify the extent of the problem and help calculate the appropriate customer credits, given the tariff structure's complexity. ComReg said the latest incident reinforced its call for additional powers to ensure that it was "able to enforce its statutory obligations on behalf of customers".

Sources say the regulator is frustrated that it cannot financially penalise firms that make the type of errors disclosed yesterday.