Energy regulator Ofgem has found that British Gas staff mis-sold energy deals, and has secured a compensation and payment package totalling £1 million.
The energy firm, which offers British Gas boiler cover, gas and electricity, and a range of other services, had put staff in Shepherds Bush’s Westfield Shopping Centre and in Sainsbury’s stores across the country between February 2011 and March 2013.
The staff were found to have mis-sold policies to prospective customers during this marketing and sales campaign.
British Gas sales staff failed to compare energy tariffs on a like-for-like basis, and compared quarterly payment methods with monthly direct debits. Potential customers were therefore given inaccurate energy saving estimates in around 5% of all quotations.
Some customers were falsely told that they would save money on their gas and electricity bills by switching to British Gas or Sainsbury’s Energy, but instead paid more for energy than they would have if they had stuck with their current supplier.
Furthermore, the sales campaigns in Sainsbury’s stores did not make it clear that Sainsbury’s Energy’s supply partner was British Gas.
British Gas investigated
Investigations revealed that around 4, 300 customers were affected by British Gas’ transgressions, and these were given a payment of around £130, or £566, 000 in total. The boiler cover provider was unable to contact a further 1, 300 customers, and is therefore paying a further £434, 000 to the British Gas Energy Trust.
This Trust provides assistance and grants to people who are in debt to their energy company, and can also see people receive boiler repairs and replacements, as well as appliance repairs in the event of an appliance breakdown. Recipients of these services do not have to be British Gas customers, but must be eligible for assistance through the Energy Company Obligation, or have a special need for an appliance repair as confirmed by a social worker or other professional.
Ofgem decided to approve the compensation package instead of formally commencing an investigation, as British Gas reported the issue to the regulator in April 2013 and immediately acted to correct these issues.
Senior Partner in charge of enforcement for Ofgem Sarah Harrison said that the regulator expects all energy suppliers to act in a way that promotes customer trust. When they fail to do so, she said, “Ofgem will act”.
She added that the energy regulator welcomes British Gas’ work to quickly compensate customers and to deal with its sales issues.
British Gas Residential Managing Director Ian Peters said the company is “very sorry”, describing the customer service issues as “extremely disappointing”.
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