Simply Energy audit

On 29 June 2021, Simply Energy paid penalties of $2.5 million in relation to the alleged fraudulent transfer of 525 gas and electricity accounts at 264 properties without any contact to obtain explicit informed consent.

In addition to this, between January 2019 and January 2021, Simply Energy had self-reported approximately 60 breaches where customers were not provided with accurate information, leading to lack of explicit informed consent.

We required an audit of Simply Energy’s explicit informed consent practices to identify the underlying causes leading to repeated potential breaches.

What we audited

We required Simply Energy to undergo an independent audit by PwC Australia (PwC). The purpose of the audit was to identify the underlying issues resulting in the repeated alleged non-compliance by Simply Energy with explicit informed consent requirements that it said arose from human and technical errors.

We approved PwC to audit Simply Energy’s key process controls and compliance in relation to explicit informed consent for the period 1 January to 30 June 2021, focused on telesales and third-party sales channels. Door-to-door sales channels were excluded because Simply Energy had ceased this activity. This included a review of:

• the practicality of Simply Energy’s quality assurance framework and its identification of non-compliance
• Simply Energy’s training program and materials, related to explicit informed consent
• how Simply Energy had remedied its self-reported breaches.

Key audit results

PwC audited 27 compliance areas. The audit found eight areas where issues were identified and Simply Energy have accepted the following recommendations:

• It will implement a process to reconcile all of its sales agents and sales training records every six months. Agents without complete records will complete the training and assessment.
• It will maintain reporting of compliance key performance indicators to its senior executive leadership team.
• It will update its quality assurance framework document to reflect that it applies to all sales partners.
• It will track external partner monthly call calibration sessions completeness to ensure they are completed in a timely way.
• It will expressly note ‘confirming quality key performance indicator requirements’ as part of its third-party service agreements with sales channels.

How this helps consumers

Simply Energy have made changes to check that its agents are trained to obtain explicit informed consent from its customers. Simply Energy have also taken steps to expand the scope of its quality control in relation to its third-party agents.

Energy retailers must obtain consent from you before they switch you over.

Before you agree, the energy retailer must give you relevant and clear information about the energy plan. You must be competent to give consent and your consent must be unambiguous.

Why we audit energy businesses

We audit energy businesses to check whether they are complying with rules designed to protect consumers.

One of our compliance and enforcement priorities is to stop energy retailers transferring customers without their consent.

Under our Energy Retail Code, energy retailers must obtain explicit informed consent from a customer before signing them up and switching them over.

Disclaimer: While the results of the audit may be published by us in accordance with our Audit Guideline for Energy Businesses, PwC disclaims any assumption of responsibility for any reliance on the report by any person other than Simply Energy and the commission.