Many households will count on their suppliers to provide some relief as they prepare for an increase in energy costs.
Money Mail found instead that power companies are releasing debt collectors in response to bills issued by mistake.
Unexpected demands have been made by customers of one company after the supplier transferred debts to another party.
Terror tactics: Instead of releasing heavy-handed debt collectors to collect bills often issued incorrectly, power firms have resorted to using shock tactics
Two watchdogs received complaints against the law firm representing the debt-purchasing business.
Many debt collectors are willing to offer huge discounts for households that pay quickly. But experts say this could lead to customers handing over cash without first ensuring the demands are correct, for fear any delay could result in a bigger bill – and complaints about inaccurate bills are at a record high.
Last month, energy watchdog Ofgem was forced to intervene after bailiffs acting for Scottish Power were filmed breaking into a woman’s flat to collect cash she did not even owe.
Most suppliers paused debt collection at the height of the pandemic in 2020 — but that reprieve has ended.
Experts fear incorrect demands will pile anxiety on to customers already worried about soaring energy costs — the average annual bill is set to hit £2,000 in April. According to them, firms with cash flow problems could increase debt collection.
Jules James, 56, is being hounded for £6,306 by EDF Energy — despite never being a customer. LCS has sent her three letters.
According to the claim, it covers two weeks of August rent for her two-bed apartment that she never occupies.
His proof showed that he had not been living on the property during the incident and was working with another supplier. But this was dismissed as ‘not relevant’.
One letter threatened legal action, saying this could ‘hinder your ability to obtain future credit or a mortgage’ if successful, and added ‘litigation costs are usually paid by the debtor’.
LCS later sent an ‘offer of settlement’, and a 25 per cent discount if the debt was paid in ten days.
Jules, who runs a branding agency, says: ‘It is bullying and it is harassment.’
The average annual bill now expected to hit £2,000 in April and experts warn that with energy firms facing cash-flow issues, more could ramp up debt collection activity
Retired local government officer Neil Hayward was also chased by LCS for £463. LCS also chased Neil Hayward, a retired local government officer. He provided proof that he was not present at the property and was working with another supplier. But this was dismissed as ‘not relevant’.
LCS asked Neil (57) for information about the sellers of his home. He refused. Neil made a complaint to EDF, LCS and resolved the matter. He was offered £300 as a goodwill gesture.
He says: ‘How many people just pay to get these firms off their backs?’ Last month, specialist debt collection law firm BW Legal sent out letters claiming households had outstanding debts with E.On dating back years.
Trustpilot comments suggest that not everyone had settled the balance, or was never with E.on.
Watchdogs the Information Commissioner’s Office and Solicitors Regulation Authority are making enquiries after receiving complaints about the firm’ .
One reader says he opened an envelope with three letters from E.ON, debt collection agency PRAC Financial and BW Legal claiming that he owed £109.45.
Addressed to ‘the occupier’ it referred to a debt accrued between July 2017 and January 2018. He was offered 65 per cent off, reducing the debt to £38.31, if paid within a month.
Experts fear that households will make incorrect demands, which could cause anxiety about energy prices.
The 35-year old telecoms engineer says that he settled his account almost six months back after changing suppliers.
Sometimes, debt collectors will enter customers’ homes without any warning.
Last summer, E.ON representatives turned up twice at a 93-year-old widow’s house claiming she owed £1,120, plus £55 for the collection.
Even though she proved she paid her bills, she was threatened by legal action. This left E.on panicked and stressed. E.on finally admitted that the bill was an error.
Martyn James, of complaints site Resolver, says: ‘Energy firms are deeply concerned about rising prices. In the absence of any meaningful solution from the Government, it’s likely some of them will look at other ways they can recoup their losses.’
Jane Tully, of Money Advice Trust, says: ‘Poor debt collection practices can harm people’s financial and mental wellbeing. There is no place for intimidating and threatening language.’
An Ofgem spokesman says: ‘We are reviewing how suppliers provide assistance to customers in debt or payment difficulty.’
E.on asserts that it gave BW Legal legitimately property details.
BW Legal states that it helps clients to identify who is responsible for any debts they have purchased. It says its letters explain that if recipients believe they are not responsible ‘they simply need to contact us and we will resolve this’.
BW Legal questions Trustpilot’s credibility and claims it works with customers to address concerns.
A spokesman adds that the letters are ‘not intimidating’.
EDF Energy stated that it had contacted Jules to verify the identity of the leaseholder. It is currently trying to determine who caused the bill.
After it had passed the address on, LCS admitted that Neil was mistakenly contacted.
Scottish Power says it paid compensation after the bailiff broke into the female customer’s home.
a.murray@dailymail.co.uk