AGL slapped with $25 million fine
Energy giant AGL Energy Limited (AGL) is being fined $25 million for receiving payments from welfare recipients.
In a statement released on Thursday, AGL confirmed that four of its subsidiaries, together, are required to pay the fine.
The issue comes as a result of the energy organisation not refunding or notifying roughly “500 customers within the required timeframe in relation to Centrepay payments” – a service that provides people on welfare with the ability to automatically pay for essential services and goods – despite said customers no longer using AGL’s services. Consequently, the energy company violated the National Energy Retail Rules.
Energy watchdog, the Australian Energy Regulator (AER), brought the case before the Federal Court.
As reported by the Sydney Morning Herald (SMH), the case found that “483 Centrepay customers” were charged $1000 on average within the timeframe spanning December 2016 to November 2021. The charges equated to over 16,000 breaches of the law.
AER chair Clare Savage said AGL’s breaches are the “largest ever” of their kind, and that they serve as a warning for retailers.
“The record $25 million penalty reflects the seriousness of the breaches and serves as a warning that the Australian Energy Regulator expects all retailers to refund customers if they have been overcharged and to provide consumers the full protections afforded under the rules,” Savage said.
“The actions by AGL negatively impacted hundreds of people over an extended period, many of these may have been experiencing vulnerability.”
AGL responded to the ruling via its own statement.
“AGL is disappointed that this issue occurred and apologises to the affected customers,” the energy company wrote.
“Since the issue was identified by AGL in mid-2020, AGL has undertaken significant process enhancements to improve its handling of Centrepay payments.
It continued: “AGL respects the decision of the Court. As the penalty is significantly higher than expected, AGL will closely review the Court’s judgment and consider whether to appeal.”
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