How to spot an unscrupulous energy broker

If you’re a small business, care home, charity or sports club, are you being overcharged by your energy broker?

Chances are, you don’t know.

But here’s a frightening statistic: According to an article in The Guardian, rogue energy brokers are locking businesses across the UK into poor long-term electricity and gas contracts and conning them out of almost £2 billion per year.

So, how can you spot these cowboys before they dig their spurs into your business?

How to spot a rogue energy broker

Let’s be honest, there are many honest energy brokers out there.

But there are plenty of rogue ones too.

Why?

Because anyone can set themselves up as an energy broker, borne out by the number of energy brokers out there swelling to around 3,000 in recent years. And this has happened because:

• It’s cheap to set up an energy brokership
• Start-ups face little to no regulation, unlike insurance or mortgage brokers

Astounding when so much money changes hands.

So, how do you spot the rogue ones?

Here are a couple of things you need to keep a lookout for when dealing with one:

1.   Beware of brokers who only require verbal agreement

Under current regulations, verbal agreements are binding. It’s easy to get caught out, a simple agreement over a call will have you locked into an agreement you’ll find it expensive to get out of.

2.   Beware of brokers who only require a signature without showing you paperwork

They might have charmed you over the phone and told you they’ll take care of the details. And as much as we all know not to sign anything until we’ve received the contract, a lot of us don’t.

If they refuse or skirt the question of sending you paperwork, there’s a chance there are hidden charges and commission in the small print that’ll hit you massively in the pocket.

3.   Beware of brokers who charge nothing upfront

Okay, honest brokers do this also, but it’s something to be aware of, especially if, like the point above, they want you to sign up without having all the details to hand.

An honest broker will be all too happy to send you documentation and would never persuade you to sign and promise to send the details afterwards.

So, with the above in mind, what’s being done to catch out these rogue traders?

What is being done to regulate energy brokers?

Following an Ofgem review, it was found some energy brokers were inflating deals on behalf of the major energy suppliers with hidden commissions of up to 50%. And, due to the lack of regulations, up to 90% of businesses using an energy broker may have been mis-sold on their deal.

Once signed up, businesses are being aggressively chased for fees and commission they didn’t realise they’d agreed to and have had their gas and electricity cut off due to non-payment.

With Ofgem’s help, businesses and organisations are already winning back money taken by hidden charges, including:

• £3,200 for a church
• £8,200 to a charity
• £10,000 to a care home
• £500,000 to a national company with 200+ sites

Ofgem’s review is a positive step for small businesses and charities, backed by their director, Phillipa Pickford:

“Tackling unscrupulous brokers will help microbusinesses get a better, fairer energy deal. This is important, now more than ever as microbusinesses emerge from the challenges posed by the Covid-19 pandemic.”

It’s something Inteb fully support too, with our owner and MD, Colin Jones saying:

“These are shameful practices but good news for the affected micro-businesses, most of whom don’t know they’re being exploited!”

If you feel your business has fallen foul of a rogue energy broker, you can file a complaint by visiting the Ofgem website and following the step-by-step guide.

Or if you’re looking to switch energy suppliers and you’re not sure how safe it is to use an energy broker, speak to Inteb instead.

How Inteb helps you get the best energy deal

Finding time to interrogate energy suppliers and micro-manage your bills might fill you with dread – but Inteb’s specialist Commercial Energy & Utility Brokerage Team love it.

Not only do we have access to the whole energy market, ensuring you secure the right deal at the right time, we use a collaborative approach to lowering your businesses energy bills, by listening and establishing what your specific requirements are both now and in the future.

And, unlike unscrupulous energy brokers, Inteb will never ask you to agree to sign with a supplier or ask you to sign anything until you’ve studied the small print with a fine-tooth comb.

All we care about is helping you to manage risk, drive down costs and make you more competitive.

Want the best energy deal for your business?

Let’s get the conversation started – call us now on 0151 601 3476