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Utility Serves Notice of Material Default On Retail Supplier, Alleges Misleading Conduct
Dominion East Ohio has served a Notice of Material Default upon Energy 95, LLC d/b/a Quake Energy, LLC, and filed the notice with the Public Utility Commission of Ohio, citing alleged, "conduct and communications that could be considered unfair, misleading, deceptive, or unconscionable."
In response to customer complaints, Dominion East Ohio (DEO) sought information from Quake concerning its sales to such customers
"DEO’s review disclosed conduct and communications that could be considered unfair, misleading, deceptive, or unconscionable; calls in which the agent failed to disclose contract terms; and calls in which an agent may have implied representation of an entity other than Quake," DEO alleged.
"On at least two calls, when a customer representative has expressed reluctance or lack of authority to enroll for service, the sales agent explicitly stated that what the caller was agreeing to was not a contract," DEO alleged
On two sales calls, DEO alleged, "the sales agent failed to disclose the offered rate, only briefly mentioning that the customer would receive a 'new low variable rate,' without explaining what that rate was, how it is derived, or how it would affect the customer’s monthly bill."
On three sales calls, DEO alleged that, "the sales agent failed to explain whether there was a contract term, termination or other fees, or any other charges. Although the automated third-party verification calls did include a lengthy statement describing the terms and conditions of the contract, DEO is concerned that this question, presented in the midst of an automated verification process, may be the first time the customer is confronted with the fact that he or she is actually entering a contract with Quake. Along those lines, the word 'contract' does not appear in the verification process, and the word 'agreement' only appears once in that process, at the end of a lengthy paragraph. As DEO understands the rules, the verification process is intended to confirm terms and conditions that the customer has already agreed to, not to present the terms and conditions for the first time."
DEO further alleged, "On a number of calls, DEO observed the sales agent repeatedly make references to the State of Ohio or the Energy Choice program, followed closely by statements suggesting that the call or enrollment was required."
DEO alleged that, for six of the complaints, Quake was unable to produce any records associated with the solicitations, including any call recordings, which DEO alleged violates record retention requirements
Furthermore, DEO also noted that four of the complaints, for which no call records were produced, involved allegations that the Quake agent suggested an association between the agent and DEO. DEO was unable to verify these complaints, given the lack of recording, "but such conduct would be consistent with the recordings provided," DEO alleged.
DEO alleged that the conduct alleged in some of the various sales calls may support a finding of slamming, as DEO alleged that the, "sales agent appears to have made misleading or deceptive statements to overcome the caller’s hesitation or even the caller’s affirmative representation that he or she lacked authority to authorize the switch."
DEO also alleged that in at least two instances, the sales agent advised the customer representative regarding the substantive responses to the questions during a third party verification
DEO further alleged the Quake sales agents were not following Quake's own internal policies and scripts
At this time, DEO is not requesting suspension or rescission of Quake’s certificate. DEO said that if the Commission agrees that Quake has materially defaulted under its ECPS [Energy Choice Pooling Service] Service Agreement, DEO believes that Quake should be given an opportunity to remedy the issues identified above.
DEO proposes that Quake voluntarily participate in a collaborative process involving the Commission Staff and other interested parties to identify the specific, reasonable, and measurable steps to cure the above alleged violations and avoid the repetition of future complaints. Among other things, DEO proposes that this process should address the following issues:
• Specified improvements in quality-assurance procedures.
• Revision of third-party-verification process.
• Review and audit of policies and practices related to the following activities: call-center, both sales and verification; general marketing, sales, and enrollment; and record-keeping and -retention.
• Commission review and approval of any changes to the foregoing policies and practices.
• Imposition of timelines for response to Commission or company inquiries.
• Ongoing complaint monitoring.
• Ongoing compliance reporting by Quake.
DEO also recommended that Quake not be permitted to request eligible-customer lists under Ohio Adm. Code 4901:1-29-13(C) until such time as the agreed-upon remedial actions have been implemented to PUCO Staff’s satisfaction.
"DEO recommends that if Quake fails either to cooperate in such a process or to implement the agreed-upon measures, more severe remedies be imposed, potentially including monetary forfeitures and suspension or rescission of Quake’s certificate," DEO said
Case 15-1894-GA-UNC
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November 10, 2015
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Copyright 2010-15 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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