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States Moves Closer To Requiring Double Verification (LOA and TPV) For All In-Person Sales

Would Apply Same Customer Protections To MLM Sales As Required For Door-to-Door Sales

Would Require Background Checks on All MLM Agents Conducting In-Person Sales

March 27, 2017

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

An Illinois ALJ has issued a proposed second notice order to adopt a host of new retail electric marketing rules, including new rules that would subject all in-person sales, including multi-level marketing sales, and sales conducted outside the customer's home (such as at kiosks), to the same requirements which were previously limited to door-to-door sales.

The proposed second notice order would define "in-person solicitation" as any sale initiated or conducted, "where the RES [retail electric supplier] agent is physically present with the customer."

The draft second notice order would state that "casual" or "dinner table" discussions concerning a retail supplier's services, which due to their nature cannot lead to an enrollment, would not be considered an in-person solicitation as defined by the proposed new rule.

"The Commission has been very clear that 'dinner table' discussions or conversations between friends and family about RES offers that cannot result in an enrollment simply are not applicable to this Section. The Commission does not find that including what seems to be a fairly obvious distinction between an in-person solicitation and any casual discussion about RES offers that cannot result in an enrollment, adds anything to this Section of the Proposed Rule," the draft second notice order states

While common and (generally) non-controversial for door-to-door sales, notable provisions that now apply to other in-person sales (namely MLM) include the requirement that sales agents wear an ID listing the RES agent's full name in reasonable size font, an agent ID number, and a photograph of the RES agent, and the trade name and logo of the RES the agent is representing

Again, while common for door-to-door, the proposed in-person rules now applicable to MLM provide that in the absence of local ordinances or regulations, RESs, and their agents, shall not conduct in-person solicitation at residential dwellings before 9 a.m. and after 7 p.m.

The proposed second notice order modifies an earlier proposal which would have prohibited in-person sales after, "7 p.m. or sunset, whichever is earlier."

Another mandated provision common for door-to-door, but unique for MLM, would be that the rules provide that RESs shall perform criminal background checks on all employees and agents engaged in in-person solicitation.

Under an earlier proposal, the criminal background check would have been required to be performed, "by an independent contractor that is a licensed private detective or a similarly qualified entity." The proposed second notice order deletes this prescriptive language concerning the type of entity which is required to be used to perform the background check.

All in-person solicitations that lead to an enrollment would require a Letter of Agency and a third-party verification.

The provisions described above would only apply to residential and small commercial customers (under 15,000 kWh annually)

Docket 15-0512

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