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PSC Staff Recommends Revocation Of Retail Supplier's License, $500,000 Fine

January 22, 2021

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Copyright 2010-21
Reporting by Paul Ring •

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In supplemental testimony, Staff of the Maryland PSC have recommended that the PSC revoke the license of SunSea Energy LLC and impose a civil penalty of no less than $500,000.

As previously reported, the PSC had previously stated that, "The Commission found that SunSea Energy violated specific provisions of Maryland law and COMAR by enrolling nearly 1,000 customers over the phone but did not provide those customers with a written contract or have the customers sign a contract prior to enrollment, failed to provide an accurate contract summary to those customers, and engaged in deceptive solicitations."

The PSC, in an October order, ordered a return of certain SunSea customers to SOS, a refund to such customers, and a moratorium on marketing and solicitation by SunSea

In such order, the PSC did not address the issue of penalties recommended by Staff, but later sought recommendations from parties in the case, with such recommendations to be informed by SunSea's compliance with the directives from the October order

Staff said in its supplemental testimony that it appears SunSea complied with the October order. Staff said that, "SunSea mailed 1,258 refund checks to customers, which is in line with the number of customers that SunSea failed to properly enroll."

However, Staff still believes SunSea should be assessed additional penalties. Staff's witness alleged, "as outlined in my October 2, 2020 Direct Testimony and made abundantly clear at the public evidentiary hearing, SunSea had committed numerous violations of COMAR, including COMAR,, 13,, and"

Staff's witness further alleged in supplemental testimony the following: "Exhibit KDM-2 contains a screen shot of the Company’s website taken October 7, 2020. The website states 'NO CONTRACT!' This is clearly a false and misleading statement. Note that this statement was not on the website when I checked January 15, 2021. Additionally, the website states 'YES COMPETITIVE RATES!' and this statement was still on the website as of January 15, 2021. As shown in SunSea’s Supplemental Response to Staff Data Request 3-1 - Attachment A, SunSea charges rates ranging from $0.1292 to $0.1899 per kWh. Currently, all utility rates are under 8 cents per kWh. Moreover, in reviewing the Commission’s MD Electric Choice website for 100 percent renewable offers, I found just two suppliers with rates above 12 cents per kWh, and one of these appeared to be a mistake. There were dozens of offers of 100 percent renewable for less than cents per kWh. While the Commission doesn’t regulate supplier prices, I do believe referring to SunSea’s rates as 'competitive' is at best misleading."

Staff further alleged: "In Staff Data Request 3-6; Staff requested that SunSea 'Provide any documentation of any complaints, formal or informal, from Maryland customers 12 since October 7, 2020, including complaints directly from customers or from CAD and all correspondence with customers or CAD in regards to such complaints.' SunSea objected to the data request, and then stated the following, 'Without waiving said objection, no such complaints have been received by SunSea Energy from Maryland customers.' However, according to CAD records, Complaint No. 1020347402-W was filed against SunSea on October 13, 2020 18 which alleged misrepresentation."

Staff also noted a recent show cause proceeding initiative against SunSea by the New York PSC for alleged violations (See story here)

"Taken together, the actions of SunSea across multiple jurisdictions indicate a company that shows willful disregard with respect to any number of consumer protection laws," Staff said

Staff continues to recommend a civil penalty of no less than $500,000 and recommend that the license of SunSea be revoked

SunSea Energy filed the testimony of Jacob Adigwe, President of SunSea Energy

SunSea said that it has complied with the PSC's October order, including providing over $66,000 in refunds

Adigwe further described the actions undertaken by SunSea as follows: "I would like to reiterate the self-imposed penalty SunSea Energy enacted in late May 2020 before a complaint was filed by OPC where SunSea Energy stopped all enrollment of new customers in Maryland. At that time, door-to-door sales had ceased due to the pandemic, so telephone enrollments were the only source of new business for SunSea Energy. I knew that SunSea Energy would take a financial hit as a result of this, but I also knew it was the right thing to do while we investigated the matter."

"Admittedly, the breadth of these violations expanded from just the interaction our agents had with [People's Counsel] Mr. Fields, and as I was learning more about other telephonic enrollment violations, I thought the most appropriate and powerful remedy was to stop all telephone enrollments, thereby ensuring that no telephone violations could occur again. This drastic step went to the heart of the issue, and was more appropriate than a monetary penalty. SunSea Energy offered this as a penalty to the Commission at the hearing on October 7, 2020, and offers it again here," Adigwe testified

Adigwe further said, "Due to the issues that existed as a result of obtaining customers through the telephone, SunSea Energy decided that it will not continue to market, solicit, or enroll customers through the telephone any longer. In fact, SunSea Energy offered this to the Commission as a potential penalty at the hearing on October 7, 2020. Once this case is resolved, SunSea Energy will only market, solicit, and enroll customers through door-to-door sales. To that end, the only marketing materials used will be the attached flyer (See Exhibit JA-1), and to the extent they are considered marketing materials, the attached contracts (See Exhibit 12 JA-2 and Exhibit JA-3)."

Adigwe added that, "I want to make sure that the Commission knows that I take these violations seriously and I will do everything in my power to ensure that SunSea Energy does not commit violations again. SunSea Energy is a small company. To assist me with compliance and other efforts at SunSea Energy, I have hired Dorothy Stone as the Compliance Manager, and Ebere Goodluck as the new Vice President of SunSea Energy."

The Office of People's Counsel recommended that the issue of a civil penalty be reserved until an audit is conducted of SunSea's refund process.

"Following this order, SunSea filed a notice of compliance with the Commission’s Order, including an excel spreadsheet listing its customers and the amount refunded, among other filings. In inspecting this list, OPC noted several discrepancies between the CAD complaints filed against SunSea and the spreadsheet SunSea submitted. OPC and submitted additional discovery to SunSea on December 21, 2020. Therein, OPC requested an explanation for the discrepancies," OPC said

"In its responses, SunSea admitted to providing an incorrectly calculated refund to one customer (shortchanging that customer by about $50), and erroneously sent two identical refund checks instead of just one to another. OPC’s discovery of these problems after reviewing just 30 of the nearly 1400 accounts identified raise troubling questions as to whether these refunds were correctly calculated. OPC therefore requests that the Commission order SunSea to engage the services of an independent accounting firm, to be approved by the Commission, who will then provide the Commission and the parties with a full audit and report on SunSea’s compliance with the refund ordered by the Commission. A civil penalty would then be determined at a later date, following the receipt of the audit report," OPC said

Case 9647

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