Watchdog fines Centrica's British Gas £1m for mis-selling

4th Jul 2014 10:12

The UK energy regulator has fined Centrica's retail arm British Gas £1m for mis-selling power and gas deals.Ofgem said British Gas had agreed the compensation package after it mis-sold products to customers in Sainsbury's stores nationwide and in the Westfield shopping centre in Shepherds Bush, west London.The regulator said British Gas sales staff exaggerated savings claims and did not compare tariffs on a like-for-like basis."In some cases, customers were told they would save money by switching, but in fact they paid more with Sainsbury's Energy or British Gas than they would have if they had stayed with their current supplier," Ofgem said in a statement.In addition, staff and branding in Sainsbury's stores did not make clear that British Gas was the supply partner for Sainsbury's Energy, the watchdog said.British Gas has identified customers to whom it potentially mis-sold products and has paid £130 on average to 4,300 affected customers. It was unable to contact around 1,300 ex-customers and this compensation is part of the £434,000 that will go to directly benefit customers via the British Gas Energy Trust.Ofgem's Sarah Harrison said: "Ofgem expects all suppliers to put this poor behaviour behind them and really start acting in a way that will help consumers trust energy suppliers. Where they don't, Ofgem will act."Shares in Centrica fell 0.5p or 0.2% to 314.3p at 10:07 in London.PW