Origin Energy has been ordered to pay a $2 million penalty by the Federal Court, for unlawful door-to-door selling practices.
The proceedings, brought by the Australian Competition and Consumer Commission (ACCC), also saw Origin's marketing company, SalesForce Australia ordered to pay a penalty of $325,000.
The penalties are the highest to be ordered against an energy retailer and an individual marketing company for door-to-door marketing.
The court found both Origin and SalesForce through the conduct of sales representatives engaged in “unlawful conduct” while calling on ten consumers at homes in NSW, Victoria, Queensland and SA when negotiated electricity contracts.
In one instance a sales representative continued to negotiate with a consumer who was a native Tamil speaker, after being advised that the consumer had difficulty understanding English.
In another, a sales representative continued to negotiate after being informed that the person on the phone was not the authorised account holder. The sales representative instructed the consumer to state that her husband, the authorised account holder, had signed an agreement when it had not been the case, which the court found constituted “undue harassment or coercion”.
In her judgement, Justice Katzmann said: “In each case the sales representative practised deceptions on the consumers in order to secure their custom.
“[The conduct] is serious, not only because of the deliberate deceptions and the exploitation of vulnerable consumers, but also because of the location and context in which the conduct occurred: at private homes to which the respondents were not invited.”
Through the actions of sales representatives, the court found that Origin and SalesForce made false or misleading representations to a number of customers including stating that there was a mistake on the consumer’s electricity bill issued by their current electricity supplier, that the consumer had to change to Origin because of government implemented changes and that the consumer was only signing an “expression of interest.”
The court also found Origin and SalesForce breached a number of unsolicited consumer agreements including failing to leave premises immediately on request of the consumer, calling outside of permitted hours and failing to inform consumers about the cooling-off period.
ACCC chairman Rod Sims said the penalties are the highest to be ordered against an energy retailer and marketing company in relation to “illegal door-to-door behaviour”.
“This reflects the serious nature of the contravening conduct, including the fact that Origin and SalesForce were held to have engaged in unconscionable conduct and undue harassment or coercion,” Sims said.
“The message is clear – energy companies must ensure their sales representatives do not use illegal tactics when negotiating with consumers at their door.”
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