Energy Scams: How UK Businesses Can Protect Themselves?

For every business owner in the UK, managing finances is always a top priority. Energy costs are often a significant portion of these expenses, so the search for the most efficient electricity providers in the UK is a crucial task. But this choice can also expose businesses to becoming targets for fraudsters, who are always on the hunt for their next target.

The energy market is constantly changing, and scammers are becoming more sophisticated, targeting businesses seeking better energy rates or those concerned about rising costs. Ofgem, energy regulator for Great Britain, has issued several warnings concerning the emergence of fraud, ranging from fraudulent communications to a scheme to alter the meter.

This article offers insights into some of the prevalent frauds that target UK businesses today, as well as the significant risks that are involved and the precautions you can take to ensure the authenticity of your business energy supplier to keep your business secure. 

The Reality of Energy Fraud in the UK

The energy industry is not protected from the influx of cybercrime and fraud that affects other sectors. The pressure of making sure the light is on and operations run smoothly makes business owners more vulnerable to pressure strategies.

The energy fraud and theft have cost customers in Great Britain over 1.4 billion each year, resources say. Although this number includes business theft, domestic consumers are usually targeted for higher amounts due to their higher consumption levels. The scams are not only about taking a few units of electricity. They are actually targeted attempts to steal funds from your accounts and induce you to take part in illegal actions, which could damage your reputation as well as safety standards.

Common Energy Scams Targeting Businesses

To protect your business, you must first recognise the risks. Scammers typically make use of urgency, fear, or the lure of huge savings to evade your own judgment.

1- Fake Ofgem Communications

A very well-known fraud where scammers pretending to appear to be the regulator themselves. You may get an email message, text, or a message claiming to be calling from Ofgem, suggesting you to switch electricity provider or share bank details. 

But the truth is, Ofgem would never sell you energy, ask for your bank details, or come over to your premises. 

2- Fraudulent “Top-Up” Sales and Prepayment Scams

Fraudsters persuade businesses to pay upfront for the services or products that are never delivered, by using misleading sales verification techniques and impersonation, posing themselves as a legitimate entity. 

This can be done with “cloned” keys or cards or via door-to-door sales. If you make use of these fraudulent top-ups, your money does not reach your business energy supplier. You are basically paying the fraudster, but you’ll be liable for the entire amount to your energy provider.

3- Meter Tampering Services

This could be the most risky energy fraud. Scammers, often posing in disguise as “energy consultants” or third-party intermediaries, could solicit your business by offering the possibility of changing your meter to reduce energy bills. Be advised is dangerous and considered a serious offense in the UK. Also, it can damage the property and cause injury and even death. Be aware of such scams, and if you find any such problem, promptly report the fraud. 

4- The Switchover Phishing Scam

In this situation, the business gets an incoming call from someone claiming to be their energy provider. The caller claims that your business energy supply will be disconnected if you do not make the payment, pushing customers to make urgent decisions. 

Fear of losing power frequently makes employees authorise the payment without verifying. In the event that the accounting department discovers the mistake, the money is gone.

The Hidden Costs of Falling Victim

The appeal of a less expensive cost or the anxiety of losing your connection can make one think twice; however, the consequences of committing these frauds, even accidentally, can be devastating.

• Financial Devastation

If you fall victim to fraud involving prepayment, you have to make two payments: one to the scammer and then to the electricity provider, as they did not get the actual bill payment. If you are the victim of fraud on invoices, recovering the money is often a challenge.

• Safety Risks to Staff and Property

The act of tampering with electrical meters is breaking security mechanisms. It can result in sparks from electrical fires, overheating, and even fatal electric shocks. As the owner of your business, you are required to fulfill a legal obligation of care to employees and stakeholders. Allowing a person who is not authorised to interfere with the electrical system puts life at risk.

• Legal Consequences

The theft of energy is considered a grave offense with severe consequences. The perpetrators could face fines of up to five years in jail. Your company could also be subject to disconnection and possibly being blacklisted by most reliable energy suppliers for business. This often makes it almost impossible to partner with the best business energy supplier in the future.

How to Protect Your Business from Energy Fraud?

Thoroughly verifying the identity of the caller is crucial to protect your business from energy fraud. Fraudsters might try to contact you through multiple communications or even by visiting your premises to get your personal and bank details, damaging your finances and business operations as well. 

The best electricity company puts efforts to make you aware of rising energy scams to protect your business. Knowing who the energy provider is and analysing if that energy company is licensed with Ofgem is the best protection against fraud. Moreover, it is better to call your energy provider by contacting their official contact number during any such circumstance. It determines whether the caller is a legitimate entity or not. If the caller pushes you to agree to a contract, thoroughly review the terms and conditions, and do not be pressurised into agreeing to a contract unless you have verified the legitimacy. 

You can easily assess whether the energy provider is licensed with Ofgem by visiting the List of all electricity licensees including suppliers, and the List of all gas licensees, including suppliers, at Ofgem’s website.

If you get an email, make sure you check the sender’s email address thoroughly. Scammers often use slight variations. Check for logos that appear blurry, stretched or pixelated, since they are frequently copied and pasted by scammers.

Report Suspicious Activity Immediately

If you believe you have been targeted by fraudster, you can Contact Action Fraud at actionfraud.police.uk in England, Wales, and Northern Ireland, or Police Scotland on 101, if in Scotland.

For extra support, you can contact the Citizens Advice Consumer Service.

Concluding Thoughts 

If you are thinking of switching to the best electricity providers in the UK, conduct thorough research and choose the one that aligns with your requirements. Do not let scammers catch you off guard. If someone calls you posing as the best electricity company, minutely verify the legitimacy and be wary of unexpected requests. 

By being vigilant, confirming every single contact, and educating your employees on the warning signs of fraud, you will be able to protect your company from the ever-changing scams. Be aware that if an energy deal seems too appealing to be true the chances are it is. Be sure to protect your money as well as your reputation by staying vigilant and reporting frauds as soon as you encounter them.