Eon fined £7.75m

2 April 2015

eon energy bulb Ofgem have slapped a £7.75m penalty on Eon, after they repeatedly and incorrectly charged exit fees and overcharged customers after sticking their prices up.

This is the fourth largest payment made to Ofgem, who will be passing the money on to Citizens Advice. Eon have already coughed-up £400,000 to affected customers.

So what happened? Well, under Ofgem's rules, suppliers have to give customers 30 days’ notice of price increases, so that they can switch to another provider before the rises come into play. Exit fees and higher tariffs should not be levied if consumers have said that they're going to leave for another company.

These errors from Eon relate to their price hikes in January 2013 and January 2014. They've paid back an average of £8 and £12 to around 40,000 customers already, but that's not good enough. Of course, Eon have already been fined £12m for violating sales rules.

Sarah Harrison, Ofgem’s senior partner in charge of enforcement, said it was "vital that suppliers play by the rules so customers are encouraged to engage in the market."

"It is important that Eon has repaid potentially affected customers and co-operated with the investigation," she added; "However, it’s absolutely unacceptable that Eon failed to provide these vital customer protections yet again and this persistent failure is the reason for the high penalty."

TOPICS:   Utilities   Government

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