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F E Smith
F E Smith, Advocate
Category: Law
Satisfied Customers: 10401
Experience:  I have been practising for 30 years.
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We are an energy broker Chinese Businesses. The broker

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We are an energy broker for SME Chinese Businesses. The broker market is rife with fraud and we are often contacted by our customers the tell us they were tricked into a contract or worse. Fairly recently we had several complaints about a broker who is submitting renewal energy contracts without the customers permission.
The contracts do have a signature on them but three separate customers have signed statements saying that they did not agree the contract and that they did not sign the contract. We have reported this to the police and have three crime reference numbers.
It seems that the police are not interested, the energy companies say it’s a business to business matter, and Trading standards don’t have the resources to any more than log the complaint.
We did try to tackle the problem head by writing to 200 customer in the brokers area. We named the broker and warned them not to agree any contract without reading it first. This letter was in Chinese and unfortunately our translator went on to say that the customer should not trusty any brokers from a particular ethnic background.
Once we found out that the letter said this we wrote to all the customers apologising for this and have put a second check in place for any translations to be signed by our director.
So we have now given the broker ammunition to complain about our conduct which he has done and has turned our complaint against him into a racial abuse matter against us.
Now what we would like to do is sue the broker for damages with regards ***** ***** fraudulent contract and somehow clear our name. The claim won’t be big perhaps £2000 but if found guilty the energy companies would have to audit all the energy contract he has submitted. So it not about the money more of proofing fraud.
We will cover the court cost for the customer and take your advice on how to proceed. This broker is costing us money but really it’s the principle that matter to us and hopefully a guilty verdict will stop him and anyone else from thinking the Chinese community is a soft target.
Hopefully this covers everything and I look forward to your reply.

I need some more information from you please.

You say that you want to sue the broker for damages of approximately £2000. How has that loss accrued? You say that you will cover the court costs for the customer? Are you saying these losses are the customers losses because if so, it is for the customer to bring those claims or have you refunded the customers and therefore it’s your loss?

Is your concern that because of the racial issue, he is using that against you?

The two issues are completely separate.

If you have suffered loss, you are entitled to sue him to get that loss back.

In respect of this letter, if you sent the letter out then you are culpable along with the translator. However it’s a completely separate issue from suing the broker for your loss. He may agree to let the racial issue drop if you drop any claim against him but that decision is yours.

If you let me know how you have lost the £2000, I can tell you how to proceed with that. If you have any other concerns or questions, I can deal with those for you if you want to ask about any individual points.

Customer: replied 1 year ago.
1. You say that you want to sue the broker for damages of approximately £2000. How has that loss accrued?The loss is the cost of the brokers fraudulent contract less the cost of the contract the customer wanted to agree with us.2. Are you saying these losses are the customers losses because if so, it is for the customer to bring those claims.It is the customers loss but they do not have the resources to sue the broker. We will fund the customer to sue the broker for the loss and prove to the supplier that the brokers contract is fraudulent. Hopefully the supplier would then look at all the contracts the broker has submitted.At the moment the supplier is refusing to look at the contract because they say it is a third party dispute.3. In respect of this letter,The letter was a mistake and we have since resent the letter with and explanation and an apology. The broker reported the racial issue to a regulatory body knowing that it would inflict the most harm. The regulatory body is supposed to investigate such claims but gave us no opportunity to defend ourselves. The broker has not reported it to anyone else or written to us directly. He did threaten to sue us after finding out that we named and shamed him but backed down when we presented the evidence we have against him.We have reported him to trading standards and the police fraud line but their processes are slow and in the meantime there are small businesses stuck with expensive long term contracts that they did not agree.What I would like to know is what is the best and quickest way to prove that this broker is acting fraudulently so the suppliers will cancel the contracts with the small businesses?

Thanks. If it’s the customers loss, that you cannot represent the customer in court unless you are solicitors. You can assist the customer in filling all the paperwork in even to the extent of sending it to the court but the customer must be the one to sign it and hence, if the customer is reluctant to get into that litigation, there is nothing that you can do.

If the broker is regulated by the Financial Conduct Authority the customer should refer the matter to the Financial Conduct Authority and the Financial Ombudsman Service. They have the power to cancel the contracts, award compensation and remove the brokers authorisation.

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