Energy ‘Slamming': Fines Could Double in NJ for Deceptive Act
Apparently the threat of a $10,000 fine hasn't done enough to stop unscrupulous energy suppliers from attempting to pull one over on New Jersey residents.
Lawmakers say certain third-party energy suppliers, particularly over the past year, have taken advantage of consumers through a practice known as energy "slamming" — changing their power or gas supplier without their knowledge or consent. So both houses of the state Legislature unanimously approved a measure that increases the penalties for slamming. It's now up to the Governor for consideration.
“A number of consumers complained of these unauthorized changes which resulted in skyrocketing energy utility bills,” said bill sponsor Assemblyman Paul Moriarty, D-Gloucester.
The measure increases civil penalties to $20,000 for a first offense. Second and subsequent offenses would be subject to fines up to $50,000.
"Higher penalties are almost always the best way to reign in bad practices," said Dena Mottola Jaborska, associate director of New Jersey Citizen Action.
Jaborska said the shady energy suppliers employ deceptive marketing practices in order to get a consumer to "sign up" for alternative energy plans. Companies may even introduce themselves to consumers as "your utility company," and from that point, she said, consumers think they're speaking with the entity that sends them a bill each month.
Jaborska said residents should never show their utility bill to a door salesman.
"What they do is they copy down your account number and that's exactly how the slamming happens," Jaborska said. "They will put your number into a contract that someone signs fraudulently, and here you are with your energy company switched without your consent."
Not all third-party energy suppliers are illegitimate. After all, they're legal in New Jersey, and so is the way they market themselves to consumers.
But to prove you're dealing with a company that wouldn't even think of "slamming" you and your wallet, Jaborska said, get as much information as possible from the seller, without giving out any of your own.
"Number one — what company are they with? If they're not giving you a straight answer, you know off the bat they're not selling you anything good," she said. "And they should have photo ID. If they're on the phone calling you, get their own name, their company name, and their phone number."
If you think you've been tricked into switching your energy supplier, or believe a salesperson attempted to weasel information out of you for the wrong reasons, the Board of Public Utilities can be reached through this site or at 800-624-0241.