Pre-payment energy provider, Utilita, has been hit with a £560,000 penalty after being found wrongly blocking customers from switching supplier between June 2010 and May 2015. Energy Regulator, OFGEM, found the supplier had been blocking customers in a variety of ways; including stopping those on fixed term contracts with Utilita transferring to another supplier.
Utilita also failed to inform customers in writing why their switch had been blocked and what action they could take to resolve any issues. The supplier has now made changes to its processes to ensure there are no barriers faced by customers should they wish to transfer to another supplier.
In total, Utilita have been ordered to pay a fine of £560,000. Step Change, a debt charity, are to receive £450,000 and £110,000 is to be refunded to any customer who financially lost out after being prevented from changing supplier.
Anthony Pygram, OFGEM’S Senior Partner with Responsibility for Enforcement said:
“The ability to switch suppliers is important for customers and fundamental to a well-functioning energy market. Utilita’s prolonged failure to allow many customers to switch was unacceptable. Utilita acknowledges its failure and is rightly looking to refund customers left out of pocket.“
OFGEM added that Utilita had co-operated well throughout the investigation and this was reflected in the penalty issued.
Responding to the penalty, Utilita has apologised “unreservedly” to those customers whom we wrongly prevented from switching supplier.
In a statement, Utilita added:
“Most customers impacted were only affected for a part of the period. Of those customers affected, under 10 per cent were left out of pocket. We will be contacting those customers as quickly as we can to rectify this. Our customers are vitally important to us and we have taken quick and decisive action to update and improve our switching procedures. None of the issues investigated remain a problem and all our transfer processes are now compliant.”