April 20, 2018

CT targets Liberty Power's 'abusive' marketing

PHOTO | Contributed
PHOTO | Contributed
The Office of Consumer Counsel has filed a cease-and-desist order against third-party electricity supplier Liberty Power.

Connecticut's consumer watchdog has filed a cease-and-desist order against third-party electricity supplier Liberty Power, citing "illegal and deceptive marketing" practices by the Florida company that it says have cost Connecticut residents more than $7.7 million.

According to the state Office of Consumer Counsel (OCC), Liberty Power Holdings LLC established "abusive" and "illegal" marketing techniques between 2015 and 2017 that attracted enrollees as a result of "overly aggressive solicitations that included false promises of savings."

OCC chief Elin Swanson Katz, who filed the cease-and-desist order, said the harmful practices have cost Connecticut consumers over $7.7 million more than they would have spent on the utility standard service rate.

The cease-and-desist request has been made to the state's Public Utility Regulatory Authority (PURA), which began investigating Liberty's practices in Sept. 2017. following numerous consumer complaints.

Katz said her staff has reviewed hundreds of recordings and written transcripts of Liberty's telesales and door-to-door marketing strategies that reveal illegal sales tactics.

OCC alleges that Liberty's practices includes impersonating utility workers to confuse customers and gain access to customer account information, misrepresenting the utility standard service rate for electricity, fabricating business partnerships between Liberty and utilities and falsely guaranteeing savings.

"Such tactics cannot be tolerated in Connecticut's retail electric marketplace, and consumers must be protected while PURA fully adjudicates this proceeding during the coming months," she said.

A Liberty Power spokesman said the company was "surprised" and "disappointed" to learn about OCC's cease-and-desist request. The spokesman said Liberty has provided "substantial" information to PURA during its ongoing investigation.

PURA has investigated Liberty Power in the past.

The state agency issued an original fine of $294,000 to Liberty in 2015 for back billing customers when the company realized it had underbilled several hundred customers.

According to PURA, Liberty also did not offer payment plans to affected customers, as required by law.

Recently, Liberty agreed to establish new restrictions on its marketing practices and refunded $550,000 to New York Consumers, Katz said. New York officials had found that Liberty's contractors and subcontractors had also drawn business with false savings promises and falsely claiming to to represent the consumer's current utility provider, she said.

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