BRITISH GAS has agreed a £1m compensation package after it was found to have exaggerated savings claims it made to prospective customers.
In the latest controversy to hit the industry, British Gas admitted it had mis-sold to customers in Sainsbury’s stores nationwide and in the Westfield shopping centre, Shepherd’s Bush, between February 2011 and March last year.
It has identified customers who were potentially mis-sold to and has made an average payment of £130 to 4,300 affected customers. As it was unable to contact another 1,300 ex-customers, a further £434,000 will benefit vulnerable customers via the British Gas Energy Trust.
Regulator Ofgem said staff and branding in Sainsbury’s stores did not make clear that British Gas was the supply partner for Sainsbury’s Energy.
It added that sales staff did not compare tariffs on a like-for-like basis, comparing monthly direct debit with quarterly payment methods to produce inaccurate savings estimates.
And in some cases, customers were told that they would save money by switching, but they paid more with Sainsbury’s Energy or British Gas than they would have paid if they had remained with their current supplier.
British Gas said it discovered the mistakes through its own internal checks.
Ian Peters, managing director of British Gas Residential, said: “We are very sorry and have ensured no customer will be out of pocket as a result.”