Energy company misled consumers in telemarketing calls

Red Energy Pty Ltd has paid four infringement notices totalling $26,400 and provided a court enforceable undertaking to the Australian Competition and Consumer Commission for alleged misrepresentations made by a
Red Energy telemarketer.

Red Energy supplies retail energy to consumers in Victoria, South Australia and New South Wales. Red Energy employees conduct telemarketing to generate sales in these states.

As part of the court enforceable undertaking, Red Energy has admitted that a telemarketer employed by them to sell retail energy made false representations and engaged in misleading and deceptive conduct during unsolicited calls
to consumers.

This included conduct that was designed to mislead consumers about the salesperson’s reason for calling, such as falsely representing that:

  • he was calling about the consumer’s current energy bill with another
    energy retailer;
  • he was affiliated with the consumer’s current energy retailer; and
  • he was not calling to sell anything.

Additionally, the Red Energy telemarketer 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.

“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,” ACCC Chairman Rod Sims said.

“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.”

As part of the court enforceable undertaking, Red Energy 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.

Red Energy has also agreed to provide customer rectification for those potentially affected by the conduct of the relevant telemarketer and to review their compliance program to ensure that this type of conduct does not occur again.