The British arm of French electricity giant EDF has agreed to pay a total of ?4.5 million to thousands of customers over the way it marketed its products, regulator Ofgem said Friday.
Ofgem decided it was better for the firm to help 70,000 vulnerable customers, like the elderly who struggle with high energy bills, rather than making EDF Energy pay a fine, the regulator said in a statement.
It added that the total payout, equivalent to 5.38 million euros or $7.1 million, was agreed by both sides after EDF Energy staff were found to have told customers they could save money without knowing individual circumstances.
Some customers were also not provided with full information regarding contracts and bill payments.
"Ofgem's investigation found that EDF Energy had breached its marketing licence conditions," the regulator said in a statement.
However, Ofgem stressed in its findings that it did not believe that EDF Energy had engaged in mis-selling.
"The authority does not consider that EDF Energy has allowed or condoned mis-selling," it said, adding that it had concerns that the interests of consumers were nor properly protected as a result of the breaches.
The regulator added that it was still investigating EDF Energy rivals Scottish Power, SSE and npower over similar issues and after toughening its marketing rules amid a shakeup of energy industry regulation in Britain.
EDF Energy will spend ?3.5 million on refunding customers. A further ?1.0 million will go to the Energy Best Deal public awareness campaign run by charity Citizens Advice.
Ofgem's senior partner in charge of enforcement, Sarah Harrison, said: "EDF Energy has done the right thing by stepping forward and recognising there were weaknesses in its sales processes. The firm also took the initiative to correct these problems during Ofgem's investigation."
She added: "In the energy market in general, much more needs to be done to restore consumer confidence and all energy suppliers should now get behind Ofgem's reforms."
Martin Lawrence, managing director for energy sourcing and customer supply at EDF, said: "We're obviously disappointed that we failed to live up to the high standards that we expect of ourselves.
"As soon as the issue was identified, we immediately took action to satisfy ourselves that we're fully compliant."
Source: http://news.yahoo.com/energy-firm-edf-pay-4-5m-over-mis-101551192.html
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