SYRACUSE — New York State Attorney General Eric Schneiderman visited Syracuse today to announce that restitution checks are on their way to nearly 2,700 New York customers of two Brooklyn–based energy companies.
Columbia Utilities, LLC, a retail natural-gas service provider, and Columbia Utilities Power, LLC, a retail electricity service provider, are sending checks totaling almost $2 million to customers they attracted by falsely promising lower rates, Schneiderman said.
The average restitution payment is $700, although the largest is $3,800, he added. Most of those receiving payments are individual consumers, but some are businesses, cooperatives, and nonprofit organizations, according to the attorney general’s office.
In upstate New York, 736 customers will receive payments. Of those customers, 343 live in Central New York, while 70 are in the Southern Tier and 70 are in the North Country. Of the remaining Upstate customers, 80 live in the Capital Region, 35 live in the Buffalo area, and 138 are in the Rochester area, according to the attorney general’s office.
“One of the reasons I’m here today in Syracuse is that of all of the areas certainly in upstate New York, the highest concentration of activity for this company was in Central New York,” Schneiderman said.
In New York City, 1,273 customers will receive restitution. In Long Island and the Hudson Valley, 672 customers are slated for payments.
The restitution is on its way after the attorney general’s office first shared details of a settlement with Columbia Utilities, LLC and Columbia Utilities Power, LLC in April 2011. In addition to the $2 million in restitution, that settlement called for the companies to pay $200,000 in state penalties and set up a $750,000 suspended penalty if the firms failed to comply with settlement terms.
The attorney general’s office investigated the companies after receiving consumer complaints, Schneiderman said.
“It’s a service provider that had a very aggressive telemarketing campaign, door-to-door campaign, telling people that they could save 15 to 20 percent on their electricity and gas prices,” he said. “Very few people saw any savings at all. The overwhelming majority saw their bills go up.”
Company representatives also refused to cancel customers’ service when they complained, citing a 12-month contract that hadn’t been clearly disclosed at the time of enrollment, Schneiderman said. And some of the utilities’ sales staff members represented themselves as being from customers’ existing utilities, he added.
Columbia Utilities and Columbia Utilities Power share a headquarters and staff members at 1350 60th St. in Brooklyn. A representative from the companies was not available for comment.
Contact Seltzer at rseltzer@cnybj.com