Sunny

Sunny

max temp: 16°C

min temp: 9°C

ESTD 1874 Search

UK: E.ON to pay £12m over mis-selling

09:38 16 May 2014

e.on is to pay £12 million to vulnerable customers as part of a redress package after an Ofgem investigation found the company broke energy sales rules between June 2010 and December 2013.

e.on is to pay £12 million to vulnerable customers as part of a redress package after an Ofgem investigation found the company broke energy sales rules between June 2010 and December 2013.

Energy supplier E.ON is to pay a record £12million to vulnerable customers after an investigation found it broke energy sales rules over a three-year period.

shares

Regulator Ofgem said the redress package reflects the harm caused by E.ON’s extensive poor sales practices between June 2010 and December 2013. Given the large number of contracts signed in this period Ofgem said it was likely a large number of customers were mis-sold to by E.ON.

Ofgem said that E.ON failed to properly train and monitor its staff and those it employed through third party telesales agencies, leading to incorrect information being provided to customers on the doorstep and over the phone.

As part of the redress package, E.ON will pay around £35 to 333,000 of their customers who are normally recipients of the Warm Home Discount. It will also make automatic payments to some vulnerable customers who may have been affected by the poor sales practices.

The company has set up a dedicated hotline and will write to around 465,000 customers it has identified through its redress work in order to see if they are entitled to compensation.

E.ON chief executive Tony Cocker said as part of overhauling its sales operations the company has ended face-to-face sales and outbound residential telephone cold calling.

He added: “It is completely unacceptable that we may have been unclear with customers about their tariff choices and as a result those customers may not have made the best choices for them.

“There was no organised attempt to mislead, and Ofgem has acknowledged this, but that does not excuse the fact we did not have in place enough rules, checks and oversight.”

Since 2010, Ofgem has imposed £100m in fines and redress on energy companies for various rule breaches, including £39m for misselling.

Among other energy companies, npower said in December it would pay £3.5 million in redress to customers after it was found to have breached rules.

Scottish Power paid £8.5m to customers last year while EDF made £4.5 million available through a redress scheme in 2012. Last year, SSE was issued with a £10.5m penalty for “prolonged and extensive” mis-selling.

E.ON’s fine from Ofgem was a nominal £1 as Ofgem decided the £12m penalty should go to vulnerable customers rather than the Treasury.

Energy Secretary Ed Davey said: “It’s right that if energy companies aren’t fair to their customers, then they’re penalised - and their customers benefit.

“That’s why we introduced legislation to ensure Ofgem can take tough action in these cases, including making the company pay compensation to the people affected.”

shares

0 comments

Welcome , please leave your message below.

Optional - JPG files only
Optional - MP3 files only
Optional - 3GP, AVI, MOV, MPG or WMV files
Comments

Please log in to leave a comment and share your views with other East Anglian Daily Times visitors.

We enable people to post comments with the aim of encouraging open debate.

Only people who register and sign up to our terms and conditions can post comments. These terms and conditions explain our house rules and legal guidelines.

Comments are not edited by East Anglian Daily Times staff prior to publication but may be automatically filtered.

If you have a complaint about a comment please contact us by clicking on the Report This Comment button next to the comment.

Not a member yet?

Register to create your own unique East Anglian Daily Times account for free.

Signing up is free, quick and easy and offers you the chance to add comments, personalise the site with local information picked just for you, and more.

Sign up now

Rooney Anand, chief executive of Greene King.

Strong Easter and Valentine’s Day sales have delivered a boost to trading for pubs and brewing group Greene King ahead of its annual results.

Holiday parks group Park Resorts has announced increated annual sales and profits.

Leading UK holiday centre operator Park Resorts today reported improved annual sales and earnings as a financial restructuring completed in 2013 began to pay off.

State-backed Lloyds Bank reported a better-than-expected 21% rise in underlying profits to £2.18 billion for the first quarter.

State-backed Lloyds Banking Group has reported a better-than-expected 21% rise in underlying profits to £2.18 billion for the first quarter as it said it benefited from the improving economy.

Challs MD Graham Burchell

A drain cleaning products company celebrating its 25th anniversary is marking the milestone with new branding.

Isaacs on the Quay

The manager of a popular waterfront bar has moved to allay fears a new licensing application could mean an increase in late night noise.

Penny Teale is to convert part of her Orford General Store into two new flats.

A village shop owner has explained the reasons why she has had to downsize her store and will convert the rest of the building into apartments.

A decision by the European Court of Justice (ECJ) means that 3,200 ex-employees of Woolworths and 1,200 former staff at Ethel Austin will not receive any money.

Thousands of workers at high street stores which went out of business have lost a long battle for compensation.

Post-Christmas boost for BA’s owner

Thursday, April 30, 2015
The owner of British Airways has forecast a big jump in profits this year as it benefits from the

The owner of British Airways has posted a profit in the post-Christmas quarter for the first time since it acquired Spanish carrier Iberia in 2011.

Shell profits slump after oil slide

Thursday, April 30, 2015
Shell has been hit by the fall in oil prices.

Royal Dutch Shell has reported a 57% slump in first quarter profits after it was hit by the fall in oil and gas prices.

Solar farm. Library image.

Plans for a third solar farm in Wix have been given the green light by councillors.

Most read

Most commented

Topic pages