British Gas has paid £1 million in penalty for mis-selling energy deals by exaggerating savings to potential customers, Ofgem said.

Staff from the Big Six firm mis-sold to customers in Sainsbury’s stores across the country and in the Westfield shopping centre in Shepherds Bush between February 2011 and March 2013. They also failed to make it clear that British Gas was the supply partner for Sainsbury’s Energy.

British Gas has paid around £130 to more than 4,300 Sainsbury’s Energy and British Gas customers who received an inaccurate quote on the savings. The company has been unable to contact another 1,300 affected customers so their compensation will also go into a fund to help vulnerable customers.

Ian Peters, Managing Director of British Gas Residential said the energy firm is “very sorry”, adding: “We pride ourselves on our high standards and it is extremely disappointing when even a relatively small number of customers don’t receive the service they expect from us.”

Ofgem welcomed British Gas’ action to tackle the failures and compensate customers.

Sarah Harrison, Senior Partner in charge of enforcement added: “Ofgem expects all suppliers to put this poor behaviour behind them and really start acting in a way that will help consumers trust energy suppliers. Where they don’t, Ofgem will act.”

Last month Ofgem referred the much-criticised power industry to the Competition and Markets Authority (CMA), starting what will be the biggest investigation into the sector to date.