Between June 2010 and December 2013 E.ON failed to properly train or monitor its sales staff, members of which then provided customers with misleading information and failed to give key terms of contracts before they were agreed. 

Ofgem’s investigation also highlighted failings in E.ON’s managerial oversight, though it cleared the top brass of deliberately attempting to mislead customers.

E.ON has agreed to pay £35 in compensation to 333,000 of its most vulnerable customers – those who are normally recipients of the Warm Home Discount, like pensioners and low-income families – and make automatic payments to some customers who may have been affected.

According to Scott Byrom of comparison site ukpower.co.uk, said: “E.ON has generally been towards the top of the class in terms of processes and procedures, so this news will be a bitter pill to swallow all around.”

Tony Cocker, chief executive of E.ON UK, said it was “completely unacceptable” for his company to be unclear with their customers.

He added: “There was no organised attempt to mislead, and Ofgem has acknowledged that, but that does not excuse the fact we did not have in place enough rules, checks and oversight.”

Cocker pledged to completely overhaul the company’s sales operations, ending face to face sales and cold calling.

Byrom continued: “This is certainly another damaging blow to the reputation of E.ON, the ‘Big 6′ and the energy industry overall.

“From a consumer point of view, it’s more evidence to showcase why sales operators of single companies can’t be trusted to give the best advice at an overall market level.”

Almost half a million customers deemed to be potentially affected by the failings will receive a letter outlining how they can have their account investigated by the E.ON Sales Compensation Fund. The energy company has also set up a hotline – 0800 056 8497 – for any customers with concerns.

Sarah Harrison of Ofgem said: “The time is right to draw a line under past supplier bad behaviour and truly rebuild trust so that consumers are put at the heart of the energy market. E.ON has today taken a good step by accepting responsibility for its actions and putting proper redress in place.”