Ofgem has blamed the instances of mis-selling on ScottishPower’s failure to effectively train and oversee its staff. The mis-selling took place between 2009 and 2012.
The energy supplier will provide £7.5 million to approximately 140,000 customers on the Warm Home Discount scheme, each of whom will receive around £50. A further £1 million will be allocated to a fund for customers who were mis-sold to.
ScottishPower issued a statement in which it said all instances of mis-selling had been identified and dealt with. The supplier no longer practices doorstep selling and carries out independent checks on its telephone agents.
Back in April, Ofgem fined SSE a record £10.5 million for several similar breaches.
Ofgem’s fine is ‘sensible approach’
Ann Robinson, director of consumer policy at uSwitch, said: “News of ScottishPower misleading customers on the doorstep is disappointing, but we welcome Ofgem’s fine and the fact that the supplier will pay £7.5 million to benefit vulnerable customers and will set aside £1 million in a fund to compensate customers.
“This is a sensible approach and we hope that this fine is a sign of drawing a line under the past. Consumers need to have trust and confidence in both the market and suppliers and that is why it’s so important that mistakes are quickly learnt from. It’s also now vital that Ofgem delivers on its reforms so that consumers are better equipped to shop around the whole of the market and to judge the best deals for themselves.”
‘Clear signal to energy suppliers’
Ofgem’s Senior Partner in charge of enforcement Sarah Harrison said: “Ofgem welcomes ScottishPower’s recognition of its failure to comply with the energy sales rules which are there to protect the consumer. This is an important step forward and demonstrates a commitment by ScottishPower towards re-establishing consumer trust.
“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.
“Ofgem’s retail market reforms, backed by enforcement action, will create a simpler, clearer and fairer energy market for consumers. Now it is time for suppliers to put these changes into action and rebuild consumer trust.”