The national energy regulator is weighing up whether to take new action against three retailers for their alleged use of the Centrepay system after a landmark court win against AGL.
The Australian Energy Regulator won a major case in the federal court against AGL in August after alleging the energy giant used the government-run payment system to wrongly take welfare money from almost 500 customers for years after they ceased being customers.
A Guardian Australia investigation into the Centrepay system has revealed two other major energy retailers, Origin and the Queensland-based Ergon Energy, have also allegedly used the system to make deductions from the welfare payments of former customers.
In Origin’s case, about $2.5m was wrongly taken from almost 3,000 former customers.
The government services minister, Bill Shorten, has since referred three energy retailers to the AER for potential action.
Guardian Australia now understands the AER, having won in the federal court, is deciding whether to take enforcement action against the three retailers.
The regulator has a range of options, including issuing fines, signing enforceable undertakings or taking civil action in the courts. It can use enforceable undertakings to compel energy companies to make payments to victims or community organisations.
Origin declined to comment on active or future proceedings. Ergon also declined to comment.
It is still unclear whether AGL will appeal the ruling.
The federal court found AGL’s failure to notify affected customers that they had been overcharged caused 3,531 contraventions of the national energy retail rules.
Another 12,625 breaches related to AGL’s failure to refund the money. The court also found the company had broken retail law by failing to implement policies, systems and procedures to ensure they were complying with the energy retail rules.
In recent months, Guardian Australia has revealed how Centrepay, a payment system administered by Services Australia, has facilitated harm to some of the country’s most vulnerable people.
The system is designed as a budget-management tool for welfare recipients. It is designed to ensure funds are first used for essentials – energy bills, rent and school fees, for example – by giving government-approved businesses early access to a person’s welfare payments.
But it has instead been used by home appliance rental companies to massively overcharge Indigenous Australians for low-value goods and by an extreme Christian rehabilitation centre to prop itself up financially while subjecting residents to gay conversion therapy and forced exorcisms.
In the energy sector, massive retailers allegedly used Centrepay to continue using the system to deduct money from welfare payment long after they had ceased being customers.
Parliament has previously heard that Origin Energy is accused of receiving $2.5m from the welfare payments of almost 3,000 former customers via Centrepay.
Court documents show AGL overcharged hundreds of customers an average of $1,233. In one case, AGL used Centrepay to make 100 deductions worth $4,111 over almost four years after it became aware the customer had departed.
AGL kept the overpayments as credit against the customers accounts and says it received no financial benefit.
