AG’s office sues electricity supplier for deceptive marketing

Illinois Attorney General Lisa Madigan’s office filed a lawsuit Thursday against alternative retail electricity supplier PALMco Power IL LLC for allegedly misleading customers about the true cost of its service.

The suit alleges that Palmco promised customers they would save money on their electric bills by switching to their electric supply, according to a statement from the attorney general’s office.

Starting in at least January 2014, Palmco charged its customers at rates consistently higher than ComEd or Ameren’s rates after the two-month introductory period ended, the attorney general’s office claims. Rates increased to levels that were more than 300 percent of what customers would have paid if they stayed with their utility company.

“Palmco deceived electric customers into switching their provider and paying much more than they should have,” Madigan said in a statement. “Palmco needs to be held accountable for violating the law by misleading people about the true cost of their electricity.

The attorney general’s office alleges that Palmco sales agents misrepresented themselves to consumers during phone and door-to-door sales by claiming they were affiliated with the consumer’s utility, that the consumer’s utility was going out of business or changing its name and that the consumer was required to sign up with Palmco.

Sales agents also violated state law by remaining on the phone while consumers completed the automated third-party verification system used to complete sales, the attorney general’s office said.

The lawsuit will be handled by Springfield Bureau Chief Elizabeth Blackston and Assistant Attorney General Philip Heimlich, the attorney general’s office said.

In a statement from PALMco, the company said that over the last year it has made several changes to the way it operates, including “enhanced sales monitoring and oversight mechanisms, as well as new policies and procedures.”