London Electricity handed £2m fine

London Electricity, the French-owned power supplier, is to be fined £2m by the industry regulator Ofgem for "totally unacceptable" doorstep selling practices.

The fine is the first to be handed down by Ofgem since it gained new powers in April to stamp out mis-selling and follows a four-month investigation by the watchdog.

The practices engaged in by London Electricity and its associate company Virgin Energy, which is 75 per cent owned by LE, included fabricating supply contracts using the names of dead people and offering householders non-existent CDs and train tickets in return for signing up to take gas and electricity.

Callum McCarthy, the chief executive of Ofgem, said: "The record of London Electricity and Virgin Energy in the mis-selling of gas and electricity since the beginning of the year has been completely unacceptable. They are in clear breach of the rules governing direct selling."

The consumer group Energywatch, welcomed the fine. Its chairwoman, Ann Robinson, said: "This sends exactly the right message to companies. The industry record on direct selling has been appalling and consumers have been waiting for decisive action against the worst offenders."

Vincent de Rivaz, the chief executive of LE group, which is part of the state-owned Electricité de France, said: "LE Group has now put its house in order."