Retail Supplier To Pay $554,000 Under Settlement With Attorney General, Ceases Residential Service

Keil & Sons, Inc., d/b/a Systrum Energy, has agreed to pay $554,000 under a settlement with the New Jersey Attorney General and BPU, and has ceased selling electric and/or natural gas service to residential consumers

The agreement, which includes $436,000 in restitution, resolves the State’s allegations that Systrum, "deceived consumers by promising they would save money by switching from their utility providers."

According to the New Jersey Division of Consumer Affairs, "Systrum lured consumers with ads that promised 'New Jersey’s Lowest Residential Electric Rates' and savings of up to 20 percent on monthly energy bills -- but never told consumers those promises would fall by the wayside if the company found them unaffordable."

"Instead, during the first three months of 2014, Systrum allegedly charged as much as 150 percent more per kilowatt-hour than the customers would have paid if they had stayed with their previous energy provider," the AG's office said

The AG alleged that after increasing customers' bills drastically for the first 2 months of 2014, Systrum abruptly canceled most, if not all, of its contracts without proper notice. The AG also alleged that Systrum induced customers to switch from their supplier through the false promise of "no contracts"

In settling with the State, Systrum asserted that it no longer provides energy services to residential consumers. Instead, the company only provides gas supply services, and provides them only to commercial customers.

Systrum will pay the State $554,698.06, of which $436,131.61 represents consumer restitution, $50,000 represents civil penalties, and the rest will reimburse the State’s investigative and legal costs. In addition, Systrum will pay a State-approved firm to act as a settlement administrator and distribute the restitution to affected residents. Systrum will pay the administrator up to $40,000, over and above the total settlement amount.