British Gas, SSE PLC (LSE:SSE) and Drax Group (LSE:DRX) are among energy companies facing a £500mln class action lawsuit after allegedly charging companies extra to fund “secret commissions” for brokers.
Law firm RGL Management claimed on Monday that thousands of UK companies could be owed up to £60,000 each based on contracts signed since 2012 that included “hidden” costs.
These costs were added to foot undisclosed payments being made to brokers whose job it was to give impartial advice on energy contracts.
Seven out of 10 UK companies were “unlawfully charged” more, according to RGL, with regulator Ofgem having warned in 2019 the hidden payments on bills breached contracts.
"For many years, energy companies acted with impunity to obscure hidden payments to brokers, artificially inflating costs for UK businesses,” RGL executive James Hayward said.
"Now that this unlawful practice has been exposed, RGL is launching this claim to recover appropriate redress for all affected businesses."
Law firms Leigh Day and Harcus Parker have also filed similar claims, with the former suggesting in February that many companies were unaware they were negotiating energy contracts with external brokers and not the supplier directly.
Some 50% of what businesses paid for gas and electricity could have been commission for brokers, Leigh Day added.