Hundreds of complaints have been made to the Trading Standards Institute (TSI) about telephone fraudsters cold-calling people and offering 'energy-saving devices' which have been found to offer no savings and are in fact a fire hazard.
The scammers claim to be representing their victim's energy supplier, and often will already know their victim's details and some or all of the digits of their credit or debit card. They then offer the plug-in device, which costs £99, claiming it will save up to 40% on energy bills.
The TSI has tested these devices and found that they do not contribute towards any real energy savings and they did not meet electrical safety standards and were liable to start a fire or cause electrocution.
TSI chief executive Ron Gainsford said: "Consumers are warned not to use the product as they pose a risk of fire and electrocution, and a safety recall has been issued for the items traced so far.
"Unscrupulous criminals are using the rising energy prices as an opportunity to lure cash-strapped consumers; elderly people seem to have been deliberately targeted. The number of complaints we are currently dealing with is bound to be only the tip of the iceberg."
The fraudsters have been offering a London W1 address for their company, but the address is actually that of a 'virtual' office provider.
Sue Jones of Westminster trading standards has been investigating the scam. She said: "The companies involved in these scams are not actually situated there. We believe the call centre they use is based abroad and the appliances appear to be distributed by a number of individuals in the UK."
She explained: "Often consumers do not realise that they have been defrauded until they receive the dodgy looking device with instructions in broken English and the accompanying invoice which names an unknown supplier and often gives an American address."
Four companies have been identified already as being part of the bogus energy-saving scheme. They are 1 Stop Marketing Solutions, ITC Development Corp, Power Saver and Athico Ltd. (Please note, Power Saver Ltd is a real company based in Kent and is not involved in the scam.)
If you receive a cold call from one of these companies or from someone purporting to be working with your energy supplier who wants to sell you one of these devices, report the incident to the Action Fraud website or you can phone 0300 123 2040.
Alternatively, you can call Consumer Direct on 0845 404 0506.
You can recognise the bogus energy-saving plug by its model number SD 001. They are manufactured by MacroPlus, B1208 City Square, Shenzhen, Guangdong, China.
Read more on the story (The Guardian)
Protect yourself from scams (FindLaw)
Find local consumer law solicitors throughout the UK (FindLaw)