Ofgem is to fine SSE a record-breaking £10.5 million for mis-selling it was announced today.
Sales representatives were found to have made ‘misleading and unsubstantiated statements ‘ to potential customers, with reference to savings they could make with the company.
As an example of a doorstep script that was inaccurate, the representative said ” “What I’m here to do today is show you a government thing called deregulation which results in your energy prices being lowered by doing nothing at all.”
The bad practice went unchecked by the management for a prolonged period, despite doorstep selling ceasing in 2011 the problems continued in telephone and in-store sales techniques.
“SSE failed its customers, missold to them and undermined trust in the energy supply industry,” said Ofgem senior partner in charge of enforcement Sarah Harrison.
“These failings did not just take place on the doorstep but also in the management of SSE. Ofgem’s fine reflects an absence of effective management control over energy selling.
“Today’s fine sends a clear message to suppliers that Ofgem will hold to account those companies which fail to treat consumers fairly. It is time for the energy industry to take note.”
SSE issued a statement saying that the company ” deeply regret that breaches occurred and apologises unreservedly to customers affected”.
William Morris, managing director of retail, admitted the company had not spent enough time monitoring sales processes. “That meant we did not always sell in the right way, and we let some customers down,” he said.
The firm has now “transformed” its processes. It has a £5 million compensation fund for those who can show they switched to SSE after being given innacurate information. Some £400,000 has been claimed so far.
Investigations continue into mis-selling in Eon, NPower and Scottish Power. A case against EDF Energy was dropped following the company’s offer to redress the customers affected with a total of £4.5 million.