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New York Attorney General Reaches $800,000 Settlement With ESCO, AG Says ESCO "Overcharged" Customers

August 30, 2017

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

As part of a wider investigation into energy service companies, New York Attorney General (AG) Eric Schneiderman today announced an $800,000 settlement with Energy Plus Holdings LLC and Energy Plus Natural Gas LLC (collectively, "Energy Plus").

According to a news release from the AG's office, "An investigation found that the company lured consumers with false promises of savings, and then fleeced them with much higher bills; failed to disclose material terms such as conditions for receiving cash back; and implied that cancellations could be processed immediately,"

"A total of $800,000 will be available in refunds for eligible consumers as part of the settlement that also imposes new restrictions on Energy Plus’s marketing practices to prevent future frauds," the AG's office said in a news release

Energy Plus provided the following statement concerning the settlement: "Energy Plus is pleased to have reached this settlement and remain committed to serving our customers in New York in full compliance with the settlement. We are proud to offer options our customers value and entering into this agreement allows us to turn the page and focus on what is most important and always comes first – our customers."

Attorney General Schneiderman said in a statement that, "Thousands of New Yorkers were lured by Energy Plus’s false promises of savings, only to be stuck with more expensive energy bills. Our settlement means we'll be able to refund consumers who were illegally scammed by this company."

"Energy service companies should be put on notice: we won't allow them to exploit New Yorkers looking to save on their energy bills," Schneiderman said in a statement

The Attorney General's office said that its ongoing investigation into energy service companies (or ESCOs) has returned more than $5 million to consumers, "including nearly $2 million to customers of Columbia Utilities Power LLC and more than $1 million to customers of HIKO Energy, LLC."

The AG's office said in a news release that, "Energy Plus used its status as an ESCO to charge its customers much higher prices than they would have paid if they purchased energy from their utilities. In many instances, consumers who received services from Energy Plus ultimately paid hundreds more per year than they would have with their local utility company."

The AG's office said in a news release that, "The Attorney General’s investigation found that Energy Plus’s direct mailings and email advertisements falsely promised competitive energy rates. Additionally, Energy Plus telemarketers promised consumers that they would benefit from Energy Plus’s 'market based' rates. Customers who enrolled were then hit with rates that were frequently much higher than those offered by their local utilities. Beginning in 2012, Energy Plus ceased many of its deceptive practices regarding rate claims. In 2013, Energy Plus settled a class action suit based, in part, on Energy Plus’s representations that consumers would pay less with Energy Plus than with their utilities, and issued $1.1 million in refunds. However, Energy Plus continued to engage in other deceptive practices, including failing to adequately disclose that its rates might be higher than the utilities’ rates and failing to disclose that cancellations could take months to process and could result in early termination fees."

"The settlement between the Attorney General’s office and Energy Plus requires that Energy Plus pay $800,000 to the Attorney General’s office to use as restitution for consumers, as well as pay penalties and fees once the restitution process is complete. The settlement also requires Energy Plus to take measures to prevent deceptive practices in the future, including adequate training of customer service representatives, refraining from misleading advertising that implies savings, regular monitoring of customer service calls, and appropriate disciplinary procedures for violations of the law," the AG's office said in a news release

New Yorkers who bought electricity or natural gas from Energy Plus after October 15, 2012 may be eligible for a refund, "if they were subject to certain deceptive practices," the AG's office said in a news release

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