Avoiding utilities scams in 2019

How widespread is consumer fraud? During 2017, the most recent year for which information is available from the Federal Trade Commission, more than 2.7 million consumer fraud reports were filed, alleging $905 million in losses. Scammers have no shortage of ways to deceive and swindle consumers; unfortunately, that includes electricity sales.

Some of these scams are becoming more sophisticated, making it harder for some consumers to tell the difference between a legitimate and a fraudulent interaction. Here’s what you need to know to stay safe if you’re contacted by someone claiming to represent a utility company or retail electricity provider.   

“Be aware that scammers can manipulate caller ID to make it look as if they are calling from your utility company,” warns finance debt resolution attorney Leslie Tayne of the Tayne Law Group PC

According to the Federal Communications Commission, this practice is called Caller ID spoofing, and it’s an illegal practice used to trick you into providing money or valuable personal information.

“If you get a phone call that your utilities will be shut off immediately – unless you pay a large amount over the phone, it’s most likely a scam,” Tayne says. “Asking for payment via a prepaid card, gift card, or wire transfer also typically signals a scam,” she explains.

If you’re in danger of your utilities getting cut off, you should have already received notices, typically by physical mail (unless you chose not to receive physical bills and notices).

Although the fraudster will try to put pressure on you to pay immediately – and may sound convincing, Tayne warns against taking swift action.  “Avoid giving payment over the phone, particularly in these forms, because it will be near impossible to get your money back,” she says. “Also, avoid giving any information such as your account number – never offer that information to a caller.”

What’s a consumer to do? Tayne offers a simple solution: “If someone claiming to be your utility provider contacts you and demands payment, hang up and call your service provider using the number listed on your utility bill to check the legitimacy of the call before resorting to any action,” she says.

Scammers can create emails using your electricity company’s logo to look like an official email coming directly from the company.” They also could produce a fake website that looks almost identical to the legitimate site. This practice is called “phishing,” and scammers are trying to see if you will take the bait.

Similar to the phone scam, the email will warn that you are in danger of having your power cut off unless you respond to the email with your financial and/or personal information. Another variation of this scam might claim that there was a problem with your banking account or credit card and ask you to submit your financial information for verification purposes.

“Always double-check the email address by comparing it to other emails you’ve received from the company and to the company’s website,” Tayne says.  “Avoid clicking on any links or opening attachments from senders you are not sure of.” She also warns against sending an online payment if the sender seems suspicious.  “Submitting payment this way can increase your risk for future scams because you are distributing your payment information in an unsecure fashion.”

If someone shows up at your door, claiming to be from an electricity provider, there’s a chance that it could be legitimate, but there also is a chance that this is yet another scam. Door-to-door energy scams are the most dangerous type for several reasons.

This person may be trying to gain assess to your home to rob you, so it’s vitally important that you don’t open the door until you can verify his or her identity.

Even if that person don’t plan to physically harm you, be advised that he or she may be out to get your money and other person information. “If someone shows up at your house offering to help with utilities for a cash fee, this is also likely a scam because your utility company will not ask for cash,” Tayne says. And if your service went out as the result of a storm, the company will turn the power back on at no cost. “Scammers like to pop up after disasters, but if you haven’t placed a work order, someone from the utility company will not typically show up unannounced.”

Another in-person scam is to pretend that there’s something wrong with your service (for example, you have a gas leak or the breaker box needs to be checked).  

“Ask the person to show a company ID or call local law enforcement,” Tayne says. And since IDs can be copied, once you know the person’s identification, call the company (using the number on your bill, not the number provided by the individual at the door) to verify that this employee should be at your house and needs to make repairs.

“Even when you have a scheduled appointment, you may want to consider calling the company to ask who they are sending beforehand,” Tayne says.

Whether you’re contacted by phone, email or in person, never try to explain that you’ve already paid your bill. Sometimes, the scammer will say the payment wasn’t received, or use some other excuse. Don’t engage this person by trying to verify payments, etc. And don’t show the person your bill – it will contain an account number that can be used against you.

You don’t want to give them any information.  Again, call the number listed on your bill or on the company’s website when you need to make contact.