Ofgem launches Npower sales probe

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Ofgem said it would investigate claims that Npower's door-to-door salespeople had been mis-selling energy contracts to customers.

The regulator said in a statement: "Ofgem has launched an investigation into a potential breach by Npower of its licence obligations relating to marketing activities. 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."

The investigation follows a report by the Sunday Times in April which claimed to uncover dishonest sales pitches by Npower's door-to-door salespeople.

Npower said in a statement: "Npower management will of course co-operate 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 will be scheduled shortly. 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. Where appropriate we have introduced additional procedures to ensure we operate to the highest standards across all our sales teams."

An Ofgem spokeswoman said it had the power to fine Npower up to 10% of its global income if it upheld the allegations. Ofgem fined London Electricity, now part of EDF, £2 million for mis-selling in 2002.