Electric utilities join forces to fight utility scams
Consumer fraud is rampant – but lucky for utility customers, a powerful group is in their corner.
The Internet Crime Complaint Center reports that Americans are scammed out of approximately $239 million each year. In addition, a Harris Poll found that phone scams affect 17.6 million Americans each year. Though precise data isn’t available, a portion of those fraudulent emails and phone calls are undoubtedly utility scams.
Working to reverse that is Utilities United Against Scams (UUAS), a group of more than 100 utilities companies and other organizations that are fighting to protect utility customers from con artists.
Jared Lawrence, vice president of Piedmont Natural Gas Customer Operations and Metering at Duke Energy, is the founder of UUAS. Lawrence said that utilities have been citing scams involving criminals impersonating utility companies for years.
“Duke Energy has been waging campaigns and working with law enforcement, but we reached a stalemate because there is not much you can do when there are just a few cases involving a few hundred or a few thousand dollars,” Lawrence said in an interview with Daily Energy Insider.
“We were trying to work on a go-it-alone basis, but I realized that if we worked together, we could shine a light on how big the problem really was,” Lawrence said. As a result, UUAS was formed in 2016, and a campaign was launched to create awareness regarding the prevalence of those scams.
Pacific Gas and Electric, Ameren, and First Energy are just some of the many companies warning their customers about utility scams, which can take various forms.
For example, scammers posing as a utility company representative will call or email customers and demand immediate payment via prepaid debit card or money transfer to avoid having their service disconnected. In another scam, criminals claim to be utility sales or service employees, and request a copy of the resident’s utility bill, or ask to record the size of the meter or fuse box inside the home.
In one example, last month the Orlando Utilities Commission (OUC) warned that numerous customers were targeted in a nationwide scam where fraudsters tried to trick utility customers into paying fraudulent bills. The scam targeted both residential and small commercial customers, OUC said.
“We’re trying to collect data to track scams,” Lawrence said. “What we’ve seen is that the number of customers falling for the scam has gone down at Duke Energy, but the data is dependent on customers telling us what happened.”
Duke Energy received nearly 15,000 scam reports between June 2015 and July 2017 with roughly $1 million in total losses reported by customers.
UUAS believes that educating consumers is crucial, and it provides tips to help customers make informed decisions.
For instance, utility companies don’t contact customers and demand payment within the hour. They also don’t ask customers to purchase prepaid debit cards and then call the company back to provide the card’s PIN number or receipt number. In addition, utility companies don’t show up at a customer’s door demanding payment or personal information.
All scam attempts should be reported by customers to their utility, and a complaint can be filed with the Federal Trade Commission.
The Edison Electric Institute, which represents U.S. investor-owned electric utilities, also advises consumers who believe they have been victims of utility scams to contact their local police department or state attorney general’s office. Victims are also encouraged to report scams online to the U.S. Department of Justice Financial Fraud Enforcement Task Force at www.stopfraud.gov.
The UUAS campaign has been so successful that the third Wednesday in each November has been designated Utilities United Against Scams Day.
In addition to its awareness program, UUAS has also been effective in tracking and disconnecting fraudulent 1-800 numbers. “We’ve formed partnerships with the telecom industry, since scammers purchase 1-800 numbers in bulk and have unsuspecting victims call the scammers back to provide their credit/debit card info,” Lawrence said.
However, Lawrence explained that all 1-800 numbers must be registered with Somos, a nonprofit organization. “When we get a number from a consumer, we can send it off to Somos and have the number investigated, and the seller can disconnect it.” To date, Lawrence said UUAS has been responsible for canceling between 250-300 phone numbers.
The success of UUAS is based on collaboration. Currently more than 100 utilities companies are engaged, including electric and gas utilities, electric cooperatives and electric and gas trade groups across North America, but Lawrence said they always welcome new members.
The recent spate of devastating hurricanes has caused numerous power outages in Texas and Florida. Does the number of utility scams creep higher after natural disasters, when consumers are at their most vulnerable? Lawrence doesn’t think there is a correlation.
“The number of scams, in general, go up due to customer anxiety and fear, and unscrupulous scammers take advantage of that.” However, he doubts that utility scams will increase in hurricane impacted areas because customers know that utility companies are more likely to relax their policies and extend deadlines or allow customers to make payment arrangements in the aftermath of a disaster.
