Power firms face mis-selling claims

Energy firms that mis-sell contracts should face automatic compensation claims of up £300, gas and electricity consumer watchdog Energywatch has said.

Energywatch said consumers should get £300 for the worst incidents of mis-selling, such as the forging of signatures on contracts.

A minimum compensation claim of £50 should apply in all other proven cases of mi-selling.

"When it comes to energy mis-selling, consumers' patience has run out, and power companies should pay up, " said Ann Robinson, Chair of Energywatch.

Sharp practice

Ms Robinson dismissed claims that automatic compensation would lead to a flurry of opportunistic claims.

"Let's not forget, if companies actually controlled their sales staff, none of this would happen," she said.

"The regulator needs to carry on regulating to further protect consumers against forgery and other unacceptable marketing practices."

Automatic compensation claims would have to be imposed by the energy regulator Ofgem.

The deregulation of the retail energy market five years ago led to a spate of questionable sales practices as electricity and gas companies began competing for customers.

Many consumers found that sales staff had forged their signatures on contracts in order to gain new business.

The watchdog said energy mis-selling problems "continue to haunt" the process of switching from one power company to another.

Energywatch said it was still receiving thousands of complaints every month over poor service by power companies.