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British Gas & Sainsbury’s Energy Guilty of Mis-Selling

energy supplier missellingAnother day, another case of energy supplier mis-selling…

This time however it is one of the great white knights of recent entrants that has fallen foul of the rules.

In recent years, a number of household name businesses have taken the opportunity to exploit their existing customer bases to diversify into the energy supply arena.

These arrangements, known as white label deals, involve a well-known brand being used as the marketing front whilst behind the scenes a traditional energy supplier does the donkey work.

In this instance it has been Sainsbury’s working in conjunction with British Gas.

Sainsbury’s Energy and British Gas are reported to have been guilty of providing inaccurate estimates to customers who signed up for tariffs between February 2011 and March 2013.

Given Ofgem have just announced that E.ON have been hit with a financial penalty of £12m for just such behaviour Sainsbury’s and British Gas have come out of this better than expected.

To their credit however British Gas contacted Ofgem to inform them of their culpability and are estimated to have already paid £500k in compensation to 4,000 affected customers.

Ofgem are not currently pursuing a formal investigation on this matter and a spokesman said:

“We don’t comment on speculation on enforcement activity.” However Ofgem equally have not ruled out a wider probe.

In total the Big 6 have been fined a barely credible £52m since 2012 for various misdemeanours.

Of that £35m alone has been levied for instances of mis-selling.

This however is the first time that British Gas have been caught up in a mis-selling case although earlier this year they were fined £5.6m for transfer blocking.

Our regular feature, the Fine Times Table, details all the fines levied, and how the suppliers’ culpability stacks up. So this it is yet another disappointing failure of the Big 6 but credit to British Gas for acting on their errors and remedying without enforcement.


It is being reported that British Gas have paid £566k in compensation to 4,300 affected customers and a further £434k into a fund for vulnerable customers where 1,300 affected customers have not been traced.

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