Power company Origin Energy has been fined the largest ever penalty for unlawful door-to-door sales tactics which "preyed on the vulnerable and ill-informed".

The Federal Court has ordered Origin pay $2 million in fines due to the conduct of its sales staff in Victoria, New South Wales, Queensland and South Australia.

Origin's marketing company SalesForce Australia were also ordered to pay $325,000 in penalties.

The court found the staff engaged in unconscionable conduct, harassed or coerced customers and made false and misleading representations which breached the unsolicited consumer agreement provisions of the Australian Consumer Law (ACL).

Justice Katzmann said the sales representatives attempted to deceive "vulnerable and ill-informed" consumers in order to secure their custom.

"[The conduct] is serious, not only because of the deliberate deceptions and the exploitation of vulnerable consumers, but also because of the location and context in which the conduct occurred: at private homes to which the respondents were not invited," Justice Katzmann said.

The Australian Competition and Consumer Commission (ACCC) brought the action against Origin, and chairman Rod Sims said the penalty reflected the serious nature of the unlawful activity.

"These are the highest penalties to have been ordered against an energy retailer and an individual marketing company in relation to illegal door-to-door behaviour," Mr Sims said.

"The message is clear — energy companies must ensure their sales representatives do not use illegal tactics when negotiating with consumers at their door."

Sales tactics found to be illegal

The offending conduct was carried out by sales representatives, acting on Origin's behalf, who called on 10 consumers across four states to negotiate electricity contracts with Origin.

In one instance, which constituted unconscionable conduct, a sales representative continued to negotiate with a native Tamil speaker after being told the consumer had difficulty understanding English.

Despite this, the sales representative prompted the consumer to say yes to questions on a phone call to confirm an electricity contract with Origin.

In another instance, the sales representative continued to negotiate with a consumer after being informed she was not the authorised account holder and she did not have any interest in changing her electricity retailer.

Despite this, the sales representative instructed the consumer to state that her husband had signed an agreement, which was not true.

The court found this also amounted to unconscionable conduct and undue harassment or coercion.

False or misleading representations found by the court included telling consumers:

there was a mistake on their electricity bill from their current supplier

there was a mistake on their electricity bill from their current supplier they had to change to Origin due to changes implemented by the government

they had to change to Origin due to changes implemented by the government they would not be charged an exit fee if they changed to Origin

they would not be charged an exit fee if they changed to Origin that the sales representative was part of a government-commissioned study investigating complaints about the cost of energy

that the sales representative was part of a government-commissioned study investigating complaints about the cost of energy that they were signing an expression of interest and their electricity supplier would not be changed until they contacted Origin

Conduct that breached Australian Consumer Law included:

failing to clearly advise consumers that the purpose of the visit was to seek their agreement to enter an Origin contract

failing to clearly advise consumers that the purpose of the visit was to seek their agreement to enter an Origin contract failing to leave the premises immediately on the request of the consumer including when a consumer had a "do not knock" sticker displayed

failing to leave the premises immediately on the request of the consumer including when a consumer had a "do not knock" sticker displayed calling on consumers outside permitted hours

calling on consumers outside permitted hours failing to inform consumers in writing of their right to terminate the contract in the cooling-off period

Past legal action against energy retailers

This was the fifth proceeding that the ACCC has taken against an energy retailer in relation to unlawful door-to-door sales tactics.

In August 2014, EnergyAustralia was ordered to pay $1.2 million and its marketing companies were ordered to pay combined penalties of $290,000.

In May 2013, AGL Sales and AGL South Australia were ordered to pay combined penalties of $1.555 million and their marketing company was fined $200,000.

The three major energy retailers, EnergyAustralia, AGL and Origin all abandoned the practice of door-to-door sales in 2013.

Last Friday EnergyAustralia was fined $1 million for the second time in less than a year for illegal conduct carried out by phone salespeople.