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Alternative Energy Supplier Has Long Record Of Fraud Complaints

CHICAGO (CBS) -- You might get a knock on your door, a telephone or mail solicitation offering savings on your gas and electric bills. But watch out.

One of dozens of alternative energy suppliers now fiercely competing for your business is a company with a bad track record the CBS 2 Investigators have been reporting on for years.

CBS 2's Pam Zekman first reported five years ago on their misleading pitch to customers like Rhonda White.

A company salesman told White a five-year fixed rate contract would save her money. When she realized it didn't, she was told it would cost $600 to cancel.

"I feel like I was swindled," White told Zekman in 2008.

Since then, the company changed its name from U.S. Energy Savings to Just Energy, and the complaints continued to pile up, prompting consumer groups to file ask the Illinois Commerce Commission – the state agency that regulates alternative energy suppliers like Just Energy – to take action.

But instead of shutting Just Energy down, as requested by consumer groups, the ICC chose to monitor major reforms the company was ordered to make.

To assess and monitor the needed changes, the ICC ordered Just Energy to pay for an independent audit completed last year. The previously confidential document said that between 2010 and 2011 Just energy received over 29,792 complaints

"It's really an astonishing figure, the 29,000 complaints. We have never seen anything like that," said David Kolata, the head of the Citizens Utility Board.

There were so many complaints over so many years with so little company oversight on how they were handled that the audit said,
"An adequate compliance culture at the top levels of the organization is not evident."

Just Energy has a history of problems with government regulators.

In 2006, CUB filed a complaint with the ICC charging U.S. Energy Savings – which later became Just Energy – with misleading marketing. That same year, the city's Department of Consumer Services filed a complaint charging it with using deceptive sales techniques

In 2008, the Illinois Attorney General charged the company with consumer fraud.

Without admitting any guilt, the company settled the city and state complaints, after agreeing to change some of its practices
and establishing a $1 million fund for refunds.

That history and the more recent audit findings, angered Michael Daniels.

"That's obscene that a company can do this to people and stay in business," Daniels said.

Daniels said he was switched to Just Energy without his permission.

"I never signed up with anybody. I was a Nicor customer," he said.

Just Energy conceded it was an "erroneous enrollment" in a letter to Daniels and gave him a refund. After he analyzed his bills, he concluded he paid $1,900 more than he would have with Nicor.

"I was flabbergasted," he said.

Since May, Just Energy has been selling electric service in Illinois as Tara Energy, and has had 15 complaints filed with the ICC.

But in Texas, Just Energy has sold electric service for years. The Public Utilities Commission fined Just Energy $17,250 for violating consumer protection rules. And it currently tops the state's consumer complaint list.

As for Illinois, Kolata said, "given the track record of just energy on the natural gas side, we do have a concern some of that will be on the electric side."

"If it was up to me," Daniels said, "I'd shut the door on them."

In a statement, Just Energy officials said:

"As a competitive energy supplier, Just Energy works hard to do right by our customers and takes customer satisfaction very seriously. For these reasons, we agreed to an audit of our sales and customer service practices in 2010. As a result, Just Energy saw a dramatic reduction in customer complaints – from 86 in the first quarter of 2010 to zero in fourth quarter of 2012. All parties involved, including the ICC staff and the Citizen's Utility Board, were satisfied that obligations outlined in the audit were met by Just Energy and support closing the matter.

"We regret any inconvenience that was experienced by Mr. Daniels, a consumer who was mistakenly enrolled in 2009 due to a back office error. Mr. Daniels was fully reimbursed, and Just Energy updated our customer enrollment system so this issue would not happen again. "

A Just Energy spokesman said the company disputes the validity of the 29,000 complaint figure.

As a result of implementing major reforms, Just Energy said it has dramatically reduced the number of complaints down to 12 last year.

Regarding Tara Energy, the spokesman said the volume of complaints is not unusual compared to other companies.

Both the company and a spokeswoman for the ICC said Just Energy has implemented major changes recommended by the auditors in everything from training its sales staff to handling complaints and supervising its staff.

A company spokesman said it no longer promises savings from its fixed rate contracts, but "protection" from the fluctuating rates of the utilities. And the cost to cancel a contract is $50.

Experts said, when considering a change in your service provider, you should compare all the offered deals. You can check them out on these websites.

The Illinois Commerce Commission

TheCitizens Utility Board

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