Consumer rights: Snake oil and energy tariffs – the many faces of mis-selling
The electricity supplier SSE has been fined £10.5m and promises it has changed, but many consumers will be wondering who they can trust
Saturday 06 April 2013
From snake oil to payment protection insurance and energy tariffs – mis-selling takes many forms. There's the straightforward "not what it says on the tin" where you're sold something that is not what it claims to be. Then there are products which do what they claim to do – for some people – but are useless when sold to people who can't use them or don't need them. Payment protection insurance was sold to hundreds of thousands of people who would never be able to claim as exemptions ruled them out.
And then there are the things that are essential but which are sold to you in the wrong way at the wrong price – such as gas and electricity. SSE (formerly Scottish and Southern Energy) is one of the big six energy providers. Over the past few years its managers seem to have assumed that rules about selling didn't apply to its employees. The company has been fined £10.5m for "prolonged and extensive" mis-selling.
Ofgem, the industry watchdog, said the company had allowed sharp selling practices over the phone, on customers' doorsteps and in-store. The judgement against SSE says management wasn't doing enough to prevent mis-selling and was allowing the culture to continue.
Some customers were told they would save money by switching to SSE but ended up being worse off. Others were told they would save more than they did by switching. Still others were told they would save money when in fact they were switched on to a more expensive contract. Even the people employed by the company to make sure that customers were treated fairly and by the rules were on commission, so they had no incentive to report or prevent mis-selling.
SSE says it is very sorry, it has learned its lesson, has completely reformed its business in this area and will be reimbursing customers. It has already paid out £400,000.
SSE isn't alone in breaking the rules and ripping off customers. In March last year, EDF Energy agreed to pay £4.5m to vulnerable customers following breaches of marketing rules. Scottish Power, Npower and E.on are also being investigated, and although there are no findings yet, you could be forgiven for thinking that doesn't leave many companies in the energy industry that consumers can trust.
The Government is debating its new energy bill which will make things simpler and hopefully clearer by limiting the number of tariffs the energy providers can use. It will also force suppliers to move customers on to the cheapest tariff automatically, and tell customers if they could get a better deal on a different tariff. Some of these changes should be in place by the autumn.
In the meantime customers don't know who to trust. If you are thinking of switching, take time to check out all of the options and tariffs and consider going through the price comparison sites. If you think you have paid out more than you should have to SSE and haven't had a letter from them yet, contact the company and ask to be reimbursed.
Q: I've lived in my leasehold flat for about 20 years. There's 68 years left on the lease.
I'm beginning to worry that if I decide to sell I will have problems finding a buyer. My neighbour tells me that I can extend my lease but that it will cost several thousand pounds.
Can you give me any advice on how to find out what the cost of an extension might be and how to go about it?
A: You are entitled to ask for a statutory 90-year extension although the freeholder may agree to a longer one. The shorter the remaining term on the current lease, the more expensive the extension can be.
The Leaseholder Advisory Service's website at lease-advice.org.uk has a lease extension calculator and a wealth of information. I've tried it with your figures and it came up with the rather off-putting figure of £18,000.
However, you might be able to persuade your mortgage lender to lend you the money, or you may find a buyer willing to extend the lease when they buy , or arrange to extend the lease at the same time as you sell, and hand over the money when the buyer pays you.
The first step would be to talk to the freeholder. If you feel it is asking for an unreasonable amount you can go to a Leasehold Valuation Tribunal.
- 1 Cyclist who knocked down three-year-old girl says his life has been 'destroyed'
- 2 A politically correct lefty goes to see Top Gear live – you'll probably believe what happened next
- 3 Young Preston fan has play-off hero Jermaine Beckford's shirt stolen from him at Wembley - which then appears for sale on Gumtree
- 4 Isis burns woman alive for refusing to engage in 'extreme' sex act, UN says
- 5 Puerto Rico, island of lost dreams: People are leaving the debt-hit territory in droves as near neighbour Cuba's star rises
As a white man, I'm surprised more women aren't tweeting the hashtag #KillAllWhiteMen
Scotland may have to leave the EU even if it votes to stay in, David Cameron confirms
The day that Britain resigned as a global power
Almost a third of school pupils believe 'Muslims are taking over our country', study claims
SNP fury as HS2 finds 'no business case' for taking fast train service to Scotland
Gay marriage 'Bert and Ernie' cake bakery found guilty of discrimination in Northern Ireland
iJobs Money & Business
£40-50K: Guru Careers: We are seeking an experienced Software / C# Developer w...
£45,000 - £55,000: Neil Pavier: Are you looking for your next opportunity for ...
£45,000 - £55,000: Sheridan Maine: Are you a newly qualified ACA/ACCA/ACMA qua...
£50,000 - £60,000: Laura Norton: Are you looking for an opportunity within a w...
Day In a Page
On the market for the first time in more than 50 years, this six-bedroom home is a project with vast potential - spread over three floors of living space.
This five-bedroom home comes with a range of outbuildings including a large barn which could be converted into a self-contained granny-flat or rental.
Surrounded by rolling countryside, this four-bedroom barn conversion comes with a self-contained, one-bedroom annexe that could serve as an office or a holiday let.
Located near Harrogate town centre, this five-bedroom Victorian terrace is arranged over three storeys while a current study serves as an optional sixth bedroom.
A ground-floor flat in a country house, located a mile from Sway; this two-bedroom home would make an ideal weekend retreat on the edge of the New Forest.
On a popular residential lane in Caterham on the Hill, this four-bedroom family home offers a secluded garden and a convenient location for local schools and public transport.
Just a short walk from Westerham green, this three-bedroom cottage has a light kitchen with exposed brickwork and double doors that lead to a south-facing garden.
In a prime spot opposite the River Thames, this one-bedroom flat has an 18sq ft reception room with glass doors that open out to a private terrace.
Set in the hills above Llanwrda Village, west Wales, this 18th-century three-bedroom farmhouse has holiday-let potential from a separate barn conversion and annexe.
This charming end-of-terrace townhouse is arranged over three floors, with two double bedrooms and a private courtyard garden located at the rear of the property.
This four-bedroom Edwardian home offers a combination of original features and contemporary design after a renovation by the current owners.
Located in the University area, this semi-detached five-bedroom home is arranged over three floors - there's even a rear garden and off-road parking too.
Only a few minutes' drive from the charming town of Marlow, this two-bedroom home sits on the private riverside estate of Harleyford.
This detached four-bedroom home in Middleyard is arranged over two floors, with features that include a wood-burning stove and bespoke oak staircase.
In a row of eight detached Georgian residences, this five-bedroom home offers views of The Sound, Mount Edgcumbe and Cornwall from its impressive veranda and full-length balcony.
If you love cooking for friends this two-bedroom flat - complete with views of the iconic Battersea Power Station and an open-plan kitchen/dining area - will go down a treat.
Located above Grasmere village, this five-bedroom home is arranged over three floors and offers countryside views across Grasmere Lake towards Silver Howe.
Surrounded by the Western fells, this five-bedroom Georgian home retains many original features including panel-plastered ceilings, sash windows and fireplaces.
This six-bedroom home is set amongst three acres of grounds. Currently a large family home, Clift Hill has potential to make a B&B, subject to change of use permissions.
A former period coach house, Glebe Farm Stable is now a three-bedroom cottage with a double car barn, office, kennels and an outbuilding that's currently used as a gym.
Set sail for this four-bedroom farmhouse in Cowes. With five acres of land and an indoor pool, this home oozes character. There is even potential to let a one-bedroom annexe.
Surrounded by woodland, this five-bedroom manor house has plenty of outdoor storage space in the form of three converted loose boxes, two smaller outhouses and a woodstore.
This four-bedroom detached home comes with a double carport, useful workshop, garden and two walkways that offer views of the adjacent countryside.
With space for an equestrian business, a greenhouse for growing your own veg, a wine store and a gym; this five-bedroom home has all the ingredients for a country retreat.
This four-bedroom home has exposed brick chimneys and a vaulted ceiling in a breakfast room that's ideal for summer entertaining - the doors open to the patio and garden.
The decked roof terrace of this two-bedroom flat is perfect for summer drinks while large windows and ample storage space make for a light and spacious interior.
Surrounded by approximately 15 acres of grounds, this six-bedroom grade II-listed home has been extensively refurbished yet retains many period features.
This four-bedroom home comes with a two-bedroom cottage and commercial office, with planning to extend, in a stunning courtyard setting.
In a pretty Norfolk village, this four-bedroom family home is surrounded by landscaped gardens, with even a self-contained annex for guests.
A few miles from the seaside at Perranporth, this four-bedroom farmhouse sits amongst nine acres of idyllic grounds - including a lake and two barns used as holiday lets.
This five-bedroom home is arranged over three floors of a converted Victorian hospital, offering spectacular views of the Pentland Hills - only three miles from the city centre.
This four-bedroom detached home comes with grounds that span to approximately 2.5 acres, as well as two large patio areas and a double garage.
This four-bedroom cottage is a Grade II-listed town house, well-located for the thriving market town of Nailsworth.
A four-bedroom apartment on the ground floor of a stunning period property in North Yorkshire, with two kitchens and a large south-west facing garden.
This high-spec two-bedroom home is part of a smart collection of new flats at Beaufort Park and has a large decked balcony that's perfect for summer drinks.
Capitalise on the fabulous views of Trevone Bay by taking two homes and creating one spacious boutique B&B. Just a cliff-top walk from Padstow.
Overlooking a golf course, this six-bedroom Edwardian detached home spans four storeys and retains many period features including the original, operational servants' bells...
On the edge of the city, this six-bedroom home comes with an outdoor swimming pool and a large garage block that has annexe potential.
In a Grade II-listed manor just outside of Bath, this three-bedroom home is arranged on two floors with a skylight in a vaulted roof line.
Open the living room's bi-fold wooden doors to reveal a retro-style kitchen, and a conservatory leading to a paved garden at this three-bedroom home.
A Grade II-listed, four-bedroom home, in a charming Somerset village, with a two-storey studio that could be converted into a holiday cottage
A modern four-bedroom Victorian home, within walking distance to the high street
A luxury apartment in the Gothic mansion of Wyfold Court in Kingwood, offers six bedrooms spread over three floors and a turret
This school conversion, near Stockwell Tube, oozes New York loft style. The one-bedroom flat features double height ceilings and exposed brick work
This six-bedroom Georgian home is on three floors with open fireplaces, a two-oven Aga, an annexe, and cottage gardens with outbuildings and a car barn
High Crest House covers an impressive 9384sq ft, with almost three acres of grounds including a tennis court and summer house enclosed by electric gates
A six-bedroom farmhouse with separate accommodation in converted stables. Situated in the village of Church Aston, within walking distance to the market town
A two-bedroom flat with under-heated walnut floors and bespoke built-in storage. The Tube and Clapham Common are a short stroll away
A refurbished seven-bedroom townhouse with staff quarters, cinema room, superb gym, steam room and plunge pool
A minimnalist four-bedroom home designed to the highest spec, featuring glass walls and a kitchen space lit by a glass roof