The industry watchdog ordered the provider to compensate customers after an investigation into its doorstep and telesales practices between 2009 and 2012 revealed staff were not “adequately” trained or monitored. This resulted in “misleading information” being provided to customers during sales approaches over the period.
Scottish Power accepted the findings and agreed with the regulator to pay £7.5m to the customers it has on the government-backed “warm home discount scheme” created for customers likely to be at risk of fuel poverty. It will also establish a £1m customer compensation fund.
The energy provider has launched a Twitter drive to address customer concerns about the penalty and confirm whether they are eligible for payments, which could reach as high as £50 for some.
Neil Clitheroe, ScottishPower’s chief executive of energy retail and generation, says the business is happy the investigation found no evidence of a strategy to deliberately mis-sell to customers.
The company stopped doorstep sales and put in place checks on the conduct of their telephone agents during the investigation. The changes were noted by Ofgem, which claimed the penalty would have been higher had they not been in place.
Clitheroe adds: “I am happy that this matter has now been concluded. We accept Ofgem’s findings and we apologize unreservedly to those customers affected. This arose as a result of new regulations which were introduced in 2009. I am sorry to say that we didn’t implement these properly at that time.
The announcement comes just days after rival British Gas’s Twitter reassurance drive to explain its price hikes was hijacked by angry customers.
It follows the record £10.5m fine handed down to rival SSE in April for “prolonged and extensive” mis-selling. Investigations into the selling practices of npower, which was launched in 2010, and E.ON, which started last year, are still ongoing.
Ofgem’s Senior Partner in charge of enforcement Sarah Harrison says: “Today’s announcement is a clear signal to energy suppliers of the consequences of breaching licence obligations and of the importance of taking action to put things right for consumers when they go wrong.