In order to establish whether four suppliers - npower, Scottish Power, Scottish and Southern Energy and EDF Energy - are complying with new obligations to prevent misselling, energy watchdog Ofgem has begun investigations into the selling tactics of these companies.
The regulator is also urging customers to call a hotline if they are concerned about the sales approach any domestic suppliers have taken when selling energy contracts, either face-to-face or by telephone.
The hotline will be available on the standard Consumer Direct number 08454 04 05 06 (when dialing this number customers should choose option 1) and
Ofgem will review any evidence of misselling of energy contracts which Consumer Direct passes on.
Last October
Ofgem introduced tougher obligations meaning suppliers have to be proactive in preventing misselling to customers both face to face and over the phone.
The obligations reflect the importance of these issues in the energy sector and are underpinned by tougher sanctions than those available under more general consumer protection law.
Also, if suppliers are selling contracts face to face they must provide customers with an estimate before any sales are concluded. In most circumstances customers should also receive a comparison of the supplier's offer with their current deal.
"Suppliers have existing obligations to detect and prevent misselling and new licence conditions were brought in following our probe to further increase protection for customers,” said Andrew Wright, Ofgem's Senior Partner, Markets.
“We expect all suppliers to comply with these tougher obligations but if our investigations find otherwise we will take strong action."
Independent price comparison and switching service,
uSwitch.com has welcomed the news
Ofgem is to launch an investigation into four energy companies following concerns of mis-selling to consumers.
According to a
uSwitch.com survey, almost seven million UK households have taken out an energy deal on their doorstep or through a direct salesman and yet less than a quarter (22 per cent) of people who have done so believe they got a good deal.
Almost a third of consumers (32 per cent) would like to see doorstep and direct selling better controlled and regulated, but 53 per cent would like an outright ban and twenty two per cent of people feel intimidated by energy doorstep and high street salespeople - 59 per cent think sales are too pressured.
Over a third of consumers (37 per cent) don't think they are given enough information by energy salesmen to make an informed choice.
"While doorstep and telephone selling serves a purpose for some consumers, it is vital that it is strictly monitored and regulated to ensure that people are not left out-of-pocket by being switched to a worse energy deal than the one they are already on,” said Ann Robinson, Director of Consumer Policy at uSwitch.com.
“We fully support Ofgem's investigation and believe it is right to check that companies are complying to both the spirit and the letter of the law.
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