Retail Supplier Agrees To $275,000 Forfeiture Under Settlement With PUC Staff
Supplier Will Give Certain Affected Customers Opportunity To Cancel Or Re-enroll; New Consent Needed For Re-enrollment
June 10, 2022 Email This Story Copyright 2010-21 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
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Direct Energy would pay a forfeiture of $275,000 under a settlement with Staff of the Public Utilities Commission of Ohio to resolve all of the issues identified by Staff in a Notice of Probable Non-Compliance dated June 9, 2021 (Notice Letter), which had alleged, "that representatives of Direct Energy provided misleading and deceptive information to consumers; that Direct Energy failed to maintain accurate records; and that Direct Energy’s enrollment information is incomplete."
Direct Energy provided the following statement concerning the matter:
"Direct Energy and PUCO Staff recently agreed to settle a matter related to Direct Energy’s door-to-door and telephone sales activities. We are pleased to have this matter resolved as we continue to focus on serving our customers."
--- Statement from Direct Energy
Staff had also alleged, "Staff is aware of at least one call that was manipulated prior to being provided as part of a response to an investigation."
As further discussed below, under the stipulation Direct Energy will reach out to certain applicable customers and provide them with an opportunity to cancel service without any penalties or re-enroll with Direct Energy. For such re-enrollments, new enrollment and consent must be obtained in accordance with Ohio Adm.Code 4901:1-21-06 and/or 4901:1-29-06.
Under the stipulation, Direct Energy has implemented/provided or will implement the actions set forth below as soon as is practicable after the Commission approves the stipulation:
• Direct has reviewed all door-to-door enrollments completed within the 3 months preceding the Notice Letter, and has taken/will take the following actions:
a. Review each contract, third-party verification, and other enrollment documentation for completeness, accuracy, and customer consent.
b. Contact each customer where enrollment documents are not complete or the customer’s consent is not certain.
c. Give each customer contacted in (b) above, the option to cancel without any penalties or to re-enroll with Direct Energy, in which case, new enrollment and consent must be obtained in accordance with Ohio Adm.Code 4901:1-21-06 and/or 4901:1-29-06.
d. Review all customer complaints that noted similar issues with the sales representatives to determine patterns of misleading and deceptive practices.
• Direct has provided Staff with a plan to come into compliance with Commission rules. The plan should address, at least, enrollment practices, an auditing process for enrollments, and any corrective actions to be implemented by Direct Energy.
• Direct has submitted to Staff a list of all vendors, contact information, and agents that have marketed on behalf of Direct Energy for the period of December 1, 2020 through May 31, 2021. "Also include the number of attempted enrollments for the identified agents along with the number of successful enrollments," the settlement states
• Direct has provided Staff with telemarketing calls for the period of January 31, 2021 through February 6, 2021, including a listing of all vendors.
• Direct has reviewed all marketing and sales scripts for compliance with rules and has submitted updated versions of these documents to Staff for review. If Direct Energy modifies its scripts in the six months following the Commission’s approval of this Stipulation, Direct Energy will submit the updated scripts to Staff.
In the original Notice Letter, Staff had alleged, "Staff reviewed investigation records from consumer complaints along with information provided by Direct Energy in response to those complaints. The consumer contact records reviewed by Staff included complaints of misleading and incomplete information, and customers disputing their enrollment with Direct Energy. Based on this review, Staff has determined that representatives of Direct Energy provided misleading and deceptive information to consumers; that Direct Energy failed to maintain accurate records; and that Direct Energy’s enrollment information is incomplete."
In the original Notice Letter, Staff had alleged, "Staff is aware of at least one call that was manipulated prior to being provided as part of a response to an investigation. According to the customer, the call started as a recording (robocall) stating it was an apology from the utility. The agent, 'Steve,' came on the line stating that he was with the 'supply department' and the customer qualified for a discount program, would no longer have to pay a $15 monthly fee, and they would receive a $70 gift card for the next three months. The customer was coached on how to answer the third-party verification (TPV) questions, and that the contract being sent to the customer would need to be signed and returned ... There are additional consumers who complained of receiving similar type telephone calls."
Staff noted that Direct Energy’s response to the investigation indicated that such representative was from a third-party vendor
In the original Notice Letter, Staff had alleged, "In addition, Staff also found instances of door-to-door agents providing misleading and deceptive information to consumers. Multiple consumers complained that agents were being untruthful, including agents stating they needed to see the utility bill to verify that everything was correct, implying the agent was with the utility, and that the customer’s contract needs to be renewed even though the customer was not currently with Direct Energy. Finally, Staff found that the acknowledgment form required as part of door-to-door natural gas enrollments was not completed."
Staff's notice letter includes the specific Ohio administrative codes which Staff allege were violated by Direct. Generally, such codes address consent for enrollments, prohibitions on slamming, and prohibitions on misleading and deceptive marketing.