A recent Government report reveals unethical conduct by TPI's

The recent report by the Department for Energy Security and Net Zero sheds light on the alarming issue of dishonest practices by Third Party Intermediaries (TPIs). These findings highlight the potential conflict of interest that arises when TPIs prioritize their own commercial motivations over the best interests of their clients. As a result, clients may be deceived about the true cost of energy, subjected to unfair comparisons between suppliers, presented with biased supplier offers that benefit the TPI, or even faced with outright misrepresentations of supplier offers.

One particularly concerning aspect highlighted in the report is the widespread abuse of Letters of Authority (LOAs). Often, fees and commissions are not adequately disclosed, and TPIs tend to offer solutions that primarily serve their own commercial advantage rather than benefiting the businesses they work with.

These dishonest practices can have severe consequences for businesses. They can find themselves locked into unsuitable contracts or provided with inaccurate savings estimates, ultimately resulting in higher energy costs or unfulfilled promises of savings.

To address these issues, the report calls upon the government to implement more effective regulations for TPIs. This includes the requirement for TPIs to obtain licenses and adhere to a code of conduct. These measures aim to protect customers and ensure that all brokers operate in a fair and transparent manner. As advocates for customer protection, we welcome the proposed legislation.

However, while awaiting regulatory changes, it is crucial for customers to take proactive steps to safeguard their interests. By following the recommendations below, customers can protect themselves from potential manipulation by TPIs:

1. Request a comprehensive contract for services instead of simply providing an LOA. This contract should clearly outline all fees and commissions imposed on the customer, detail the broker's obligations and service deliverables, and include provisions for dispute resolution.
2. Never provide an LOA that grants the broker the authority to sign supply contracts on your behalf. Retain control over the decision-making process to ensure it aligns with your best interests.
3. Seek out brokers who work with ALL suppliers, not just those offering the most favourable terms to the TPI. This ensures a fair and unbiased assessment of available options.
4. Always request a summary of all offers received. This will enable you to compare and evaluate the options objectively.
5. Demand verification of ALL broker commissions from the chosen supplier. This transparency allows customers to make informed decisions based on reliable information.
6. Do not solely rely on a broker's word regarding promised savings. Request to see the calculations behind these claims and, if necessary, seek clarification until you fully understand the details. Vigilance is key to avoiding potential pitfalls.
7. Whenever possible, converse with other customers who have worked with the broker. Their experiences can provide valuable insights and help you make more informed decisions.

By implementing these measures, customers can protect themselves from unscrupulous practices and ensure they receive fair treatment in the energy market. Ultimately, it is essential for both customers and regulators to work together to create an environment where all brokers operate ethically and transparently.

For more comprehensive information on this topic, we encourage you to read the full Third-party intermediaries in the retail energy market: summary of responses report.