SSE Fined £10.5m By Ofgem Over Mis-Selling

Energy provider SSE has been fined £10.5m by industry watchdog Ofgem for repeated mis-selling to householders.

The regulator said the proposed penalty is the largest it has made against an energy firm.

It relates to failures at "every stage" of the sales process for telephone, in-store and doorstep activities.

Ofgem said: "The level of fine reflects the seriousness and duration of breaches, the likely substantial harm that they have caused and the likely gain to SSE."

Ofgem found that a failure of SSE's management arrangements meant that insufficient attention was paid to ensuring compliance with obligations.

The watchdog said this enabled misleading and unsubstantiated statements to be made by sales agents to potential customers about savings.

SSE is one of Britain's "big six" energy suppliers and has admitted its selling procedures were below an adequate level.

On its website, SSE said: "We've been busy making lots of practical changes to make it simpler, fairer and easier for you to deal with us.

"We're building a better way to do business, and we believe the changes we are making will improve the energy industry for good."

Many consumers struggled to understand firms' complex tariff structures

The watchdog said the company's various selling techniques had brought the company into disrepute.

"Ofgem found failings at all stages of SSE's sales processes, from the opening lines on the doorstep, in-store or over the phone through to the confirmation process which follows a sale," the regulator said.

"In particular, SSE consistently failed, over a prolonged period of time, to conduct its sales activities in a way that would provide clear and accurate information on prices and potential savings to enable customers to make an informed decision about whether to switch suppliers."

Although SSE terminated doorstep sales in July 2011, the failures in telephone and in-store sales persisted, Ofgem said.

"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 and get behind Ofgem's reforms to rebuild trust and make the market simpler, clearer and fairer for consumers."

Ofgem does not have legal power to require companies to award consumer compensation.

It has argued for powers of redress and said it was encouraged that the Government has backed its call over new powers.

The regulator said the when the Energy Bill powers come into force they will further strengthen Ofgem's ability to take more targeted action against companies that are found in breach of their licence.

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