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Origin Energy Hit With $2m Fine

Origin Energy Hit With $2m Fine
Mar 30, 2015 By Wise-owl

The Federal Court has fined Origin Energy Limited (ASX:ORG) with a $2m fine after the company was found guilty of illegal door-to-door sales. Justice Anna Katzmann said Origin and its marketing company SalesForce exploited vulnerable consumers in their homes with the intent of getting them to sign energy contracts. “In each case the sales representative practiced deceptions on the consumers in order to secure their customer," Justice Katzmann said in her judgment. Some of the “unconscionable conduct” included a sales representative continuing to negotiate with a native Tamil speaker after being told the customer didn’t understand English very well. Origin has been ordered to pay $2m in penalties while SalesForce was fined $325,000 after both companies were found to be in breach of the unsolicited consumer agreement provisions in the Australian Consumer Law (ACL).

The fine levied against Origin is double the fine that its rival EnergyAustralia received last week in a similar case. Australian Competition and Consumer Commission (ACCC) chairman Rod Sims commented that the watchdog has recently noticed more unconscionable behavior from energy retailers. “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.” Chairman Sims also cited ACCC’s commitment to protecting consumers as the reason for the increased number of legal cases against energy companies.

Shares of ORG have been affect by this recent judgment, falling 44c, or 3.76 per cent, to $11.27 per share near the end of trading hours on Monday. Shares of ORG have been struggling lately, with share prices falling 21.26 per cent in the last 12 months. ORG is down 3.5 per cent so far this year.

 

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Wise-owl Author: Wise-owl Mar 30, 2015

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