June 20, 2014
Attorney General Kane takes legal action to protect consumers from deceptive marketing of electric rates
HARRISBURG - Attorney General Kathleen G. Kane today announced that the Bureau of Consumer Protection and the Office of Consumer Advocate have filed joint complaints against five out-of-state electric generation suppliers before the Public Utility Commission, after some consumers complained their electricity costs increased by as much as 300 percent.
The joint complaints seek to have the PUC suspend or revoke the licenses of the following suppliers and impose civil penalties, as well as provide appropriate restitution including any necessary refunds: Energy Services Providers Inc. d/b/a Pennsylvania Gas & Electric; IDT Energy Inc.; Respond Power LLC; Hiko Energy LLC; and Blue Pilot Energy LLC.
"The core function of the Consumer Protection Bureau is to advocate for consumers and investigate fraud on their behalf. We received thousands of complaints from consumers who could not pay their excessively high bills. Those consumers were deceived and we are taking those who participated in the deception to task," said Attorney General Kane.
"I would like to thank the many consumers who contacted our office and shared their experiences," said Acting Consumer Advocate Tanya J. McCloskey. "Through the actions taken today, we will take the necessary steps to address the harm to consumers and to ensure compliance with Pennsylvania consumer protection laws and regulations."
The joint complaints allege that the suppliers enticed consumers by promising low or "competitive" rates if the consumer switched suppliers. The actions also allege that the prices charged to customers were not reflective of the cost to serve residential electricity needs.
Between late February and mid-June, the Office of Attorney General received 42,603 telephone calls and 7,551 consumer complaints about electricity spikes. During that same time period, the Office of Consumer Advocate received more than 3,000 contacts from consumers.
The suppliers are accused of multiple violations of the Public Utility Commission's orders and regulations, the Public Utility Code, the Consumer Protection Law and the Telemarketer Registration Act.
The Bureau of Consumer Protection found that many consumers complained that their electricity supplier was switched without their consent. The unauthorized switching of electricity suppliers is considered "slamming" and is a violation of the PUC Regulations and the Consumer Protection Law.
The actions also allege that consumers were provided with copies of contracts or terms and conditions pages that did not comply with the Telemarketer Registration Act.
The joint complaints were filed before the Public Utility Commission by Senior Deputy Attorney General John M. Abel and Assistant Consumer Advocate Candis A. Tunilo.
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