Energy Retailer under Scrutiny for Banned Door-to-Door Sales

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Victoria’s energy regulator has accepted a court enforceable undertaking from retailer 1st Energy Pty Limited following allegations that the company violated the Statewide ban on door-to-door energy sales. The ban, which took effect in December 2021, prohibits unsolicited visits and cold calls by energy retailers and their representatives.

Evidence gathered by the Essential Services Commission indicates that between January and March 2022, 1st Energy signed up 81 new customers through unsolicited home visits conducted by third-party sales agents. Agents gained entry to homes under the pretense of installing in-home energy monitoring devices, but then used the opportunity to solicit energy quotes and contracts from 1st Energy via SMS without the customers’ prior consent.

Commissioner Sitesh Bhojani stated there are clear rules prohibiting these types of unsolicited sales tactics. He said “Retailers who try to get around [the ban] by having third parties conduct these activities on their behalf risk enforcement action.”

1st Energy acknowledged the conduct likely violated Victorian energy laws. It has ceased working with the sales agency in Victoria.

As part of an enforceable undertaking accepted by the Commission, 1st Energy must implement stricter oversight and training on unsolicited sales laws. It will also appoint an independent auditor to monitor compliance.

Bhojani said while the statewide ban has been generally effective, the Commission will take action when evidence of non-compliance emerges. He reminded retailers the ban applies equally to retailers and their agents.

The Victorian Parliament legislated the ban in late 2021 to protect consumers from high-pressure and unwanted marketing tactics. Bhojani said the Commission is also closely monitoring compliance with consumer protection laws requiring clear consent for energy contracts.

This 1st Energy case highlights the need for continued vigilance and proactive compliance to uphold the ban on door-to-door sales. Retailers must take responsibility for the actions of their sales agents and partners. Comprehensive training, auditing, and reporting procedures are essential to prevent unwanted marketing approaches. Swift remediation and penalties for non-compliance will demonstrate the seriousness of these legal protections for consumers. As energy costs rise, regulators must send a strong message that prohibited sales tactics will not be tolerated.

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