HARTFORD — Palmco Power will pay Connecticut $5 million and relinquish its electric supplier license for five years in a settlement over high electric rates, state officials said.
Attorney General George Jepsen and Consumer Counsel Elin Swanson Katz said the settlement resolves an investigation initiated in February 2015 regarding Palmco’s business practices.
Evidence showed that from January 2011 to October 2015, Palmco systematically and repeatedly deceived consumers by providing false and misleading information about the company’s rates and engaged in a pattern of abusive sales tactics. Through door-to-door marketing and telemarketing efforts, sales agents often switched consumers to Palmco without authorization, impersonated utility employees and falsely guaranteed savings. In addition, sales agents inaccurately described how the customer’s variable rate prices were determined.
Palmco customers generally paid the highest rates charged by any supplier in Connecticut. Rates were nearly 40 percent higher than the next highest supplier’s rates and were triple the standard service rate offered by the state’s two utility companies.
“This settlement is an example of our commitment to protecting all Connecticut consumers from deceptive and unfair business practices,” Jepsen said. “Palmco engaged in systemic efforts to trick electric customers. While we will continue to work to hold accountable those who engage in coercive and misleading sales tactics, consumers themselves must also remain attentive to their bills and know what they’re being charged.”
Under the terms of the settlement, Palmco did not admit liability but has agreed to two voluntary payments totaling $5 million to state of Connecticut.