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NJ settles deceptive sales practice lawsuit with energy vendor

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A third-party energy supplier has agreed to a $1.36 million settlement with New Jersey authorities for allegedly scamming and overcharging customers, the New Jersey Attorney General's office announced Wednesday.

IDT Energy Inc. agreed to revise its “unfair and deceptive” practices that it was accused of using during a harsh 2014 winter in order to charge customers exorbitant energy bills.

The state alleged that in early 2014, IDT Energy switched customers’ energy suppliers without their approval, lied to customers about lower energy rates and inserted contract provisions which violated state and federal consumer protection laws.

New Jersey authorities opened an investigation into IDT Energy following numerous complaints from residents about enormous electricity bills, Grewal said. The instances all happened during the 2014 “Polar Vortex,” a period of bitter cold between Jan. 1 and March 31, 2014.

With the multi-million settlement, $1.2 million will go towards consumer restitution, $100,000 towards civil penalties and $38,755 towards New Jersey’s attorney fees and investigative costs.

IDT Energy must employ a full-time compliance officer to make sure the company follows New Jersey law, Grewal said. IDT will also have revise its auditing, customer service and sales practices, and ensure the truthfulness of any content on brochures, websites and other marketing materials.

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Daniel J. Munoz

Daniel J. Munoz

Daniel Munoz covers politics and state government for NJBIZ. You can contact him at dmunoz@njbiz.com.

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