An Ofgem spokesman said: “This investigation is being carried out under Ofgem’s powers to enforce licence conditions. The decision to investigate follows recent allegations that npower sales representatives have been mis-selling energy contracts to customers.”
Investigators will have to decide whether npower salespeople breached its gas and electricity supply licence obligations.
Under these obligations all suppliers are required to have appropriate procedures for selecting and training sales staff. The licence obligations also state a salespoerson must make potential customers entering into a new contract fully aware they are doing so and must contact them within 14 days of any contract being signed to confirm they are happy to proceed.
Npower said it was taking the allegations extremely seriously. A company spokesman said: “npower management will of course cooperate fully with Ofgem in its investigation.
“We were very concerned at the actions of a small number of individuals in a London sales team as reported in the Sunday Times.
“We took swift action to take the team off the road and investigate the problem. Following an in depth investigation by our Audit team, disciplinary hearings have been scheduled for later this week.
“We cannot prejudge the outcome of these meetings but the penalty for fraudulent activity is dismissal.
“We have also taken steps to confirm that the systems in place currently are working effectively and we have taken the entire npower sales force off the road to reinforce the standards that we require.
“We have also introduced additional procedures across the whole sales force which reinforce our current processes.”