Big Six energy firm SSE fined record £10.5m by energy regulator Ofgem

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One of the main 'Big Six' energy suppliers in the UK has been hit with a record £10.5m fine by Ofgem.

SSE received the fine due to what the energy regulator called 'management failures' that then led to 'prolonged and extensive' mis-selling.

The fine is the largest ever dished out by Ofgem - with it punishing SSE over mis-selling in a number of areas including telephone, in-store and also doorstep sales.

Ofgem senior partner in charge of enforcement, Sarah Harrison, said: "Ofgem's findings show SSE failed its customers, mis-sold to them and undermined trust in the energy supply industry.

"These failings did not just take place on the doorstep but also in the management of SSE.

"Ofgem's fine reflects an absence of effective management control over energy selling."

Ofgem found SSE guilty of mis-selling in a number of ways with examples including informing customers they would save money, when instead they were hit with higher bills.

Other examples included, telling customers other suppliers made "all sorts of false promises" and even misinforming a customer who planned to switch from SSE, due to an energy price increase, that the rival she planned to move to had upped its bills by 14% combined when in fact it had increased gas prices seven per cent and electricity prices seven per cent.

The money from the fine will be paid to the Treasury as Ofgem does not have the necessary power to force energy providers to reimburse customers.

SSE has however set in place a £5m mis-selling fund from which customers can seek compensation. The pot was set up following a previous investigation at the tail end of 2011 when Ofgem was looking into SSE over misleading doorstep selling. The energy regulator found SSE guilty in May 2012, fining it £1.25m.

Out of the £5m fund, around £400,000 has currently been paid out to 6,500 customers.

SSE managing director, William Morris, said the firm was "deeply regretful of the way in which we failed to manage and monitor some sales activities" and added that "standards slipped below the high levels all customers should be able to expect."

SSE is part of the 'Big Six' energy suppliers who are all participating in the Government's Green Deal. Through the scheme, customers can receive a subsidy on installing a range of items in their home to improve energy efficiency. This includes everything from installing a replacement boiler, to fitting wall or loft insulation.

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