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PSC Opens Investigation Into Alleged Slamming By Retail Supplier

July 25, 2016

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Copyright 2010-16 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

The Michigan PSC directed that the Michigan Agency for Energy Staff, on behalf of the Commission, shall conduct an investigation into the alleged unauthorized switching of natural gas customers by Direct Energy Services, LLC, to ensure that customers are not switched without the proper authorization and to determine if any fine or penalty is recommended.

The PSC said that, on March 15, 2016, the Michigan Agency for Energy (MAE) received a complaint alleging an unauthorized switch of residential gas service from Consumers Energy Company to Direct Energy Services, LLC.

The MAE Staff requested the name of the Direct Energy agent that enrolled the complainant and a record of the agent’s completed sales

According to the PSC, Direct Energy reviewed 73 of the agent’s 282 sales and Direct Energy reported that 20 of the reviewed sales contained suspicious activity that included: (1) agent impersonation; (2) same voice; and (3) authorizing names not matching the name of the person on the phone. MAE Staff’s response to the report resulted in Direct Energy refunding all of the complainant’s charges to the account and the cancellation of service from Direct Energy.

The PSC further noted that Direct Energy in 2013 had entered a settlement with the PSC concerning self-reported slamming violations, which resulted from a third-party vendor. As part of the 2013 settlement, Staff monitored Direct Energy for a 12-month period, and Staff found no reoccurrence of customer slamming by Direct Energy’s salespersons during the 12-month monitoring period, which ended in March 2014.

In light of the new slamming complaint, the PSC directed that Direct Energy file a report that: (1) details any violation of law or business ethics by Direct Energy, Direct Energy Business, LLC, and any agent of either company subsequent to March 2014 in connection with the provision of energy or energy-related products or services that resulted in a criminal conviction, civil judgment, or any agreement to pay a penalty, fine, or settlement; (2) details any resulting financial penalty or obligations stemming from any reported activity; (3) describes Direct Energy’s policy and process when an agent is accused of slamming a customer; (4) details the measures taken by Direct Energy to validate that all other sales submitted by the agent allegedly responsible for the slamming of the complainant were authorized sales; (5) includes a confidentially filed section that provides a detailed customer list of all sales submitted by the agent allegedly responsible for the slamming of the complainant that includes the name, address, phone number, incumbent utility, the date contacted, and a detailed synopsis of each interaction between the customer and the agent; and (6) provides a determination from Direct Energy of whether any customer enrollment submitted by the agent allegedly responsible for the slamming of the complainant violated any Direct Energy policy, and if so, includes a synopsis of each enrollment that did violate Direct Energy policy.

Direct Energy provided the following statement to EnergyChoiceMatters.com: "We have been very responsive to the Commission’s previous requests for information and will continue to provide additional information."

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