Direct Energy Services, LLC settles Illinois lawsuit for deceptive practices for $12 million
Direct Energy Services, LLC has settled a lawsuit from the state of Illinois over deceptive and fraudulent business practices for $12 million.
Illinois Attorney General Kwame Raoul filed suit against Direct Energy alleging the company violated the Illinois Consumer Fraud and Deceptive Business Practices Act by deceptively enrolling customers in their services and sometimes charging customers electricity rates over 230% higher than what they would have paid for at the default public utility rate.
Raoul's office also obtained a consent judgement preventing Direct Energy from marketing to and enrolling Illinois customers for the next 12 months. It also includes a permanent injunction barring Direct Energy from enrolling customers in their services without their knowledge or consent, misrepresenting that customers would save money, misrepresenting an affiliation with a public utility or government, deceptively obtaining customers' account information, misrepresenting "price protection," and failing to disclose new rates and new terms.
The $12 million settlement will give restitution to customers who got their electricity from Direct Energy between 2013 and April 2025. The amount each customer receives will be based on their electricity usage during the period they were with Direct Energy.
This is not the first lawsuit Raoul and his office have successfully litigated against third-party utility companies using fraudulent or deceptive practices. In December 2024, the state succeeded in a $3.5 million judgement against Palmco Power IL, which operated as Indra Energy, and in September 2024 the attorney general announced a $10 million judgement against Teleperformance Colombia SAS, TPUSA Inc. and Teleperformance SE .
Raoul filed suit against Spark Energy LLC and Spark Energy Gas in January for allegedly using fraudulent, unfair and deceptive business practices to trick customers into spending millions more on electricity and gas. That case has not yet been heard.
