Ofgem has today secured £250,000 from Economy Energy following mis-selling and poor communications by the supplier. Ofgem’s investigation found that Economy Energy did not have adequate processes and procedures in place between October 2012 and December 2013, and senior management failed to ensure it was complying with the regulator’s rules.
Economy Energy mis-sold energy contracts between October 2012 and December 2013. Inadequate training and a lack of management oversight contributed to sales agents quoting inaccurate comparative savings, providing a misleading guarantee of cheaper prices than those offered by the six largest suppliers, and failing to behave fairly and professionally. The supplier also didn’t make it clear to prospective customers that they would be signing up to a 12-month contract. Economy Energy has already paid over £23,000 to nearly 500 affected customers, and Ofgem expects the supplier to do more to identify and compensate any remaining affected customers.
Economy Energy also failed to give advance notice of price increases in April and November 2013, affecting up to 70,000 customers. Customers were therefore not given the opportunity to switch before the price increases took effect. Some who were moved to a more expensive tariff reclaimed their money, and Economy Energy gave £100,000 of unclaimed cash to the National Children’s Bureau to help families living in fuel poverty.