Fine for phone sale mistake
1st Energy has been fined for wrongly signing up a dementia sufferer, billing her thousands and then sending debt collectors.
Victoria's Essential Services Commission has issued 1st Energy a $20,000 penalty and ordered an audit into the company's operating practices.
The company must also take steps to prevent a repeat incident and could risk losing its Victorian licence.
Eighty-six-year-old Joan Ford was signed up by a 1st Energy telemarketer last year.
Mrs Ford told the consultant she was living in an aged care facility in Melbourne, was not a business owner and did not have an ABN.
Even so, the telemarketer signed her up to a 1st Energy business plan, leading to her being billed over $2,500 in a three-month period.
1st Energy said it would fix the problem when it was contacted by Mrs Ford's family after the first bill arrived, but this was followed by a second bill and a phone call from a debt collection agency.
The company reportedly apologised and made a $2,000 compensation payment.
Essential Services Commission chair Ron Ben-David said it should be a reminder to all telemarketers to listen closely to the person on the other end of the phone.
“This was not a case of human error. This was a case of human stupidity,” Dr Ben-David said.
“It was absolutely clear that Mrs Ford could not have been speaking on behalf of a nearby business.
The company was also found to have failed to inform the regulator of its error, as its retail licence required.
“I would like to think that 1st Energy has learned the lesson and it has put in place all the necessary safeguards to ensure this can never happen again. If they haven't done that, they are playing with a loaded gun,” Dr Ben-David said.
1st Energy issued a statement saying customers are “at the heart” of its business.
“1st Energy rectified the matter, apologised to the individual customer impacted, and took the opportunity to enhance controls across our sales partners and service teams to reduce the risk of recurrence,” she said.
The Victorian Government last year pledged to ban energy companies from conducting door-to-door sales or cold-calling customers, but no timeline has been set for these reforms to be carried out.
The state says it would also require companies to tell customers if they are currently on the cheapest available deal.