E.On fined record £12.5m for mis-selling

WEST Midlands-based energy giant E.On will have to pay £12.5m to customers it mis-sold to following a ruling by regulator Ofgem.

It will be the largest penalty paid to date by a UK energy supplier.

An Ofgem investigation found “extensive poor sales practices” amongst staff selling on the doorstep and by phone.

Coventry-headquartered E.On has apologised to its customers, and has promised to pay compensation to anyone who was mis-sold an energy package.

The company has estimated that the bill for compensation payments is likely to be between £3m and £8m, on top of the £12m penalty.

Tony Cocker, E.On’s chief executive, told the BBC he is “devastated” by the results of the investigation.

The mis-selling took place over a three-and-a-half year period, between June 2010 and December 2013.

Customers were misled by sales staff, and some may have been sold more expensive tariffs than they were already on with other companies.