An energy company will pay £525,000 and its director has agreed to step down for serious and persistent mismanagement that resulted in customers being overcharged, Ofgem said today. Its investigation discovered that since 2021, Essex-based Farringdon Energy – trading as Champion Energy – did not have the proper billing systems in place to adequately manage its customers’ accounts and to accurately record their energy consumption.

This led to repeated instances where Farringdon routinely retained advance payments from customers as “Early Termination Fees” despite having not supplied any energy to these customers. Farringdon also failed to issue energy bills based on actual meter readings, resulting in 159 customers – many of which were small independent businesses such as takeaways and convenience stores – being overcharged a total of £347,717.25.

As a result of the investigation findings, Farringdon has refunded these customers with an additional £50 compensation payment for each affected customer.

Ofgem’s investigation determined that Farringdon’s licence breaches were the result of serious and sustained mismanagement at a time when responsibility for day-to-day oversight sat entirely with its director.

Following the conclusion of Ofgem’s investigation, Farringdon has agreed to pay £525,000 to Ofgem’s Voluntary Redress Fund – in addition to the direct refunds and compensation already paid to affected customers. It will also be subject to enhanced regulatory oversight, independent audits and introduce wide-ranging reforms to its operational and governance structures.

Finally, the director will step down from the board of Farringdon Energy Limited in recognition of his involvement in the mismanagement which resulted in these breaches – and pledged not to serve as a senior manager in the business moving forward.

Cathryn Scott, Ofgem director for market oversight and enforcement, said: “This unacceptable treatment of customers was a result of serious and sustained mismanagement where the only course of action was to remove the director responsible.

“Ofgem is satisfied that Farringdon has taken the necessary action to reimburse affected customers, significantly improve its processes and adhere to our requirements for enhanced regular monitoring by the regulator.”

Ofgem added that Farringdon was previously discovered to be collecting payments it was not entitled to for energy it was not providing its customers – this led, in June 2025, to Ofgem imposing a penalty of £214,580, plus £9,096 compensation paid and £177,271 refunded to customers.