New York AG James Pulls the Plug on Deceptive Energy Sales Tactics, Obtains $2.15 Million in Penalties

  • Following an investigation into numerous consumer complaints of deceptive sales practices, New York AG Letitia James has reached an agreement with energy service company Family Energy, Inc. over allegations that Family Energy used marketing and sales practices that violated New York’s General Business Law, New York Public Service Commission regulations, and the federal Telephone Consumer Protection Act and Telemarketing Sales Rule.
  • According to the Assurance of Discontinuance, Family Energy failed to effectively monitor and supervise the activities of sales representatives it hired through marketing contractors to perform in-person sales and telemarketing of its electricity and natural gas services. The sales representatives allegedly engaged in “slamming” and other deceptive methods of enrolling customers; made false and misleading statements about savings and a “cash back” program; failed to disclose the cost and voluntary nature of “green” electricity and “eco-gas” programs; and failed to disclose early termination fees, among other things. Sales representatives also allegedly contacted customers on the state and federal Do Not Call lists.
  • Under the terms of the AOD, Family Energy will pay $2.15 million in restitution and is enjoined from engaging in further deceptive sales and marketing practices. It is also required to take measures to prevent future deceptive practices, including training, monitoring sales calls, and implementing appropriate disciplinary procedures.