LG has been caught red handed, cheating on energy-efficiency tests for its popular refrigerators.

The manufacturer made them appear more energy efficient. LG Electronics will be compensating thousands of its dissatisfied customers after its fridges-models L197NFS and P197WFS were detected with an illegal device that sets on an energy-saving mode, if it is placed in the conditions similar to those in the laboratory where it has been tested.

The consumer advocacy group Choice managed to discover the circumvention device last month. It detects test conditions and activates the mode, thus creates an impression that it is consuming less energy and performing at comparatively lower running costs. Though, such devices have been banned in Australia since 2007.

LG fridge has a 3.5 star energy rating. Choice's test is sure evidence that the fridge which was advertised to consume 738kWh hours a year is consuming 876 kilowatt.

Choice Chief Executive Nick Stace shared that the fridge is a proof of companies' false and misguiding environmental claims, often termed as "greenwashing".

Mr. Stace said, "This fridge is both a potential danger to your food, your wallet and the environment".

Affected customers will be paid up to $331 to reimburse the increase in their electricity bills. This has happened for the consecutively third time that LG Electronics has been caught making false claims as far as its environmental claims are concerned.