Tomato Energy has been banned from taking on new customers due to concerns about its £3m debts.
Ofgem, the gas and electricity market regulator, announced it was slapping the electricity-only retailer, which has bases in Basingstoke and Wolverhampton, with a “provisional order” requiring the firm to pause key activities while investigators check its books.
The regulator said in its order it “was informed by multiple market participants that they were considering commencing legal proceedings against Tomato Energy for the recovery of unpaid liabilities totalling over £3m.”
Tomato has been told to “refrain from all sales, marketing and customer acquisition activity, including the acquisition of any new domestic and non-domestic customers” until Ofgem is satisfied things are in order
“Customers are unaffected by this announcement” – Tomato boss
Farouk Alhassan, Tomato Energy CEO, said: “We remain confident in our products and financial resilience and will be working closely with Ofgem to resolve any concerns.
“The company enjoyed rapid growth in recent months so in March we temporarily paused the acquisition of new customers to focus on reviewing our processes and expanding our teams to provide a faster and smoother customer journey.
“This was already having a positive impact but there was more work to be done, so we plan to use the additional time created by last week’s Ofgem announcement to make further improvements and to settle any late payments.
“I would like to reassure our existing customers that they are unaffected by this announcement.
“We look forward to satisfying Ofgem’s requirements and welcoming new customers again soon.”
Tomato Energy has about 12,000 customers.
