Energy provider Red Energy pays infringement notices for misleading telemarketing calls
Thursday 5 September 2013 @ 9.34 a.m. | Trade & Commerce
By media release dated 3 September 2013 the Australian Competition and Consumer Commission (ACCC) has advised that Red Energy Pty Ltd has paid four infringement notices totalling $26,400 and provided a court enforceable undertaking to the ACCC for alleged misrepresentations made by a telemarketer on behalf of Red Energy.
Red Energy is a retail energy supplier to consumers in Victoria, South Australia and New South Wales (NSW) and uses telemarketers to conduct telemarketing in those states. Red Energy was launched in 2004 and is owned by Australian company Snowy Hydro. It employs over 300 people and is based in Melbourne.
The ACCC has announced that as part of the court enforceable undertaking, Red Energy has admitted that one of its telemarketers made "false representations" and engaged in "misleading and deceptive conduct" during unsolicited calls to consumers.
The conduct the subject of the infringements included conduct designed to mislead consumers about the salesperson’s reason for calling, such as falsely representing that they were:
- calling about the consumer’s current energy bill with another energy retailer;
- affiliated with the consumer’s current energy retailer; and
- not calling to sell anything.
In addition, the telemarketer is reported by the ACCC to have made false representations to consumers that all energy retailers in NSW must charge consumers the same price for retail electricity, when this was not the case, and that all retail electricity prices in NSW are regulated by government, when this was not the case.
In the media release ACCC Chairman Rod Sims is quoted as saying:
“Consumer protection in the energy retail sector is an enforcement priority for the ACCC. We have previously put energy companies on notice that they will be held responsible for the conduct of their door to door salespeople. The same applies to telemarketing . . . The ACCC takes very seriously the obligations placed on businesses by the Australian Consumer Law and will continue to take action to protect consumer from false or misleading representations.”
The ACCC has also indicated that part of the court enforceable undertaking agreed to by Red Energy is that it will publish a corrective notice and a link to the Australian Energy Regulator’s price comparator website Energy Made Easy on the homepage of its website. As well Red Energy will provide customer rectification for those potentially affected by the conduct of the telemarketer and review its compliance program to ensure that conduct is not repeated.
Quoting consumer law expert Katarina Klaric of Stephens Lawyers, SmartCompany offers the advice that: "the penalty imposed by the ACCC appeared to be fair in view of Red Energy’s cooperation with the ACCC . . . If you have a rogue employee, it is best to cooperate with the regulators and they are more likely to get a penalty, rather than end up in court . . ."
As the use of telemarketing continues to grow it will be interesting to see how this area of consumer law develops especially in relation to the sale of utilities like electricity and gas.
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