Octopus may not be reimbursed for some SOLR payments

oliverbrown

An Octopus spokesperson says that they will refund all payments to former Avro customers even though it looks like they might not be able to claim all the payments under the SOLR scheme.

Article: https://inews.co.uk/inews-lifestyle/money/bills/ofgem-investigates-whether-octopus-should-pay-credit-to-customers-who-were-switching-to-avro-when-it-went-bust-1607934

Mstty

Surely if Avro do not send Octopus all the credited money they just claim this from Ofgem and that goes on standing charges?

MWT

Mstty said:

Surely if Avro do not send Octopus all the credited money they just claim this from Ofgem and that goes on standing charges?

That isn't how it works.

What Octopus are saying is that Ofgem may refuse claims for 'customers' in this very specific group, so they can't reclaim the money from Ofgem.

Under normal circumstances the failed supplier doesn't actually send the SoLR any cash at all, it all gets reclaimed from Ofgem and the cost passed on to us.

If there is anything left at the end of the administration process for distribution to unsecured creditors then the amount that would have been paid to ex-customers can be used to reduce the Ofgem levy, but that is far from certain and will take time.

Avro for example are still in Administration even now...

StartledJesus

Is anyone actively hauling Avro, and the many related others of their ilk - you know who you are - over the coals? Or have the architects and 'players' and bad actors of their maladministration (allegedly) escaped scot free, without penalty or prosecution, and had it away on their toes?

oliverbrown

Jake Brown appeared before a Commons Select Committee, if that counts as "hauling over the coals": https://www.leicestermercury.co.uk/news/local-news/boss-failed-energy-firm-apologises-7013820

MWT

StartledJesus said:

Is anyone actively hauling Avro, and the many related others of their ilk - you know who you are - over the coals? Or have the architects and 'players' and bad actors of their maladministration (allegedly) escaped scot free, without penalty or prosecution, and had it away on their toes?

The Administrators are still investigating and considering options there and until they reach a decision you will not find much detail about what is being done...

There is a very recent update from them on the Companies House website though...

https://find-and-update.company-information.service.gov.uk/company/09174794/filing-history/MzMzNzU2ODQzOGFkaXF6a2N4/document?format=pdf&download=0

Mstty

MWT said:

Mstty said:

Surely if Avro do not send Octopus all the credited money they just claim this from Ofgem and that goes on standing charges?

That isn't how it works.

What Octopus are saying is that Ofgem may refuse claims for 'customers' in this very specific group, so they can't reclaim the money from Ofgem.

Under normal circumstances the failed supplier doesn't actually send the SoLR any cash at all, it all gets reclaimed from Ofgem and the cost passed on to us.

If there is anything left at the end of the administration process for distribution to unsecured creditors then the amount that would have been paid to ex-customers can be used to reduce the Ofgem levy, but that is far from certain and will take time.

Avro for example are still in Administration even now...

So is this £306 million claimed by Octopus for taking on Avro customers not related to this?

https://www.google.com/url?sa=t&source=web&rct=j&url=https://www.ofgem.gov.uk/sites/default/files/2021-12/Octopus%20Energy%20Limited%20-%20Gas%20Consent%20-%20for%20Avro%20Energy%20Limited_0.pdf&ved=2ahUKEwj779Diqsb3AhVlnVwKHVpHDScQFnoECAgQAQ&usg=AOvVaw09ZIXxv7l640cSvQ_2c3G8

QrizB

Mstty said:

MWT said:

Mstty said:

Surely if Avro do not send Octopus all the credited money they just claim this from Ofgem and that goes on standing charges?

That isn't how it works.

What Octopus are saying is that Ofgem may refuse claims for 'customers' in this very specific group, so they can't reclaim the money from Ofgem.

So is this £306 million claimed by Octopus for taking on Avro customers not related to this?

No, it seems it isn't.

Ofgem are quite specific about what they will and will not allow to be claimed under the SoLR arrangements, and it seems these particular customers may be a "will not".

I remember the heady days of 2021 when customers would hurriedly switch from one failing supplier to another, confident that if their latest one also failed their prepayments would be protected.

We'll have to remember this thread as a cautionary tale should those days come around again.

StartledJesus

@MWT Thanks. I'll read that 45 page report in bed tonight...

Interesting stuff, though. One thing I immediately noticed was that at least some of the Avro debt book has been passed on for collection to a company called Credit Style. CS has been mentioned on another thread, and not in a good way, as possible scammers, but it would appear that their role is actually official. IIRC some of the debts being chased were very old, or didn't exist in the first place, but CS were being quite 'forceful'. 

StartledJesus

oliverbrown said:

Jake Brown appeared before a Commons Select Committee, if that counts as "hauling over the coals": https://www.leicestermercury.co.uk/news/local-news/boss-failed-energy-firm-apologises-7013820

Yes, I was aware of that, and the mention of some unfeasibly large 'consultancy' payments and inter-company transfers. He and his colleagues and relatives obviously imagine themselves to be very smart and cute. It would seem that the very least they are guilty of, allegedly, is poor record keeping - and the least they deserve is a kick up the backside. They may not be legally liable for any anomalies or missing funds - they have made sure of that - but surely they must be morally liable. In my personal lay opinion, without prejudice. Karma, do your stuff...

MWT

StartledJesus said:

@MWT Thanks. I'll read that 45 page report in bed tonight...

Interesting stuff, though. One thing I immediately noticed was that at least some of the Avro debt book has been passed on for collection to a company called Credit Style. CS has been mentioned on another thread, and not in a good way, as possible scammers, but it would appear that their role is actually official.

Yes, in this case, and I suspect the others they are mentioned in connection with, it is the 'closed' customer debts they have passed on to them to handle. So those are not the ones with still active accounts that would have been passed on to Octopus to recover.