AG Sues Starion Energy Over Deceptive Sales Tactics

Alleges company falsely promised 130,000 consumers lower electricity bills...
Attorney General Maura Healey

BOSTON – A competitive electricity supplier has been sued for allegedly using unfair and deceptive marketing and sales tactics to lure more than 130,000 Massachusetts consumers into expensive contracts with high electricity rates, Attorney General Maura Healey announced today.

The AG’s Office filed the lawsuit today in Suffolk Superior Court against Connecticut-based competitive electricity supplier, Starion, two of its principals, Ruzhdi Dauti and Dashmir Murtishi, and several related telemarketing companies, Telelink, LLC, Telestars, LLC, F E Z, LLC and StartelDM, LLC. The complaint alleges that the parties violated the state’s consumer protection laws by engaging in unfair sales tactics including unsolicited telemarketing calls and pre-recorded robocalls that deceived Massachusetts customers by falsely promising them lower electricity rates while signing them up for expensive contracts that ultimately made them pay millions more on their bills.

“We allege Starion Energy extorted millions of dollars from Massachusetts customers by falsely promising them big savings on their electricity bills, while overcharging them month after month,” AG Healey said. “This case is another example of why my office is seeking to stop these companies from continuing to cheat residential customers in Massachusetts.”

"Even with our strong consumer protection laws in Massachusetts, Starion and many other competitive electric supply companies continue to deceive thousands of Massachusetts families," said National Consumer Law Center Attorney Jenifer Bosco. "This is a particular hardship on the elderly and low-income families who struggle to pay basic bills, and we commend Attorney General Healey for bringing this lawsuit against a bad actor. Ultimately, ending residential sales of competitive electric supply may be the only way to stop these deceptive practices." 

According to the AG’s Office, Starion signed up more than 130,000 Massachusetts customers, who ultimately paid tens of millions more on electricity than they would have if they had stayed with their utility company.

The AG’s Office also alleges that Starion’s telemarketing entities knowingly violated the law by making calls to consumers on the state’s Do Not Call Registry and masking identity of the caller and the geographic location of the call. The company allegedly received complaints from consumers who had been listed on the registry for many years.

Starion’s telemarketing and pre-recorded robocall scripts used deceptive and misleading information including that “most consumers are overpaying on their energy bills by hundreds of dollars each year” and that new laws that have been passed in the area give consumers “the right to receive a lower rate on [their] current electric bill.”

The AG’s Office’s complaint seeks civil penalties and restitution for the defendants’ violations of the state’s consumer protection and telemarketing laws.

In March 2018, AG Healey issued the results of a report commissioned by her office that called for a ban on competitive electricity suppliers signing up new, individual residential customers in Massachusetts. The report found that Massachusetts residential electric customers who switched to a competitive electric supplier paid $176.8 million more than if they had stayed with their utility company during a two-year period from July 2015 to June 2017. The study also found that during the period studied competitive suppliers used aggressive sales tactics and appear to have targeted low-income, elderly, and minority residents.

The AG’s Office has received hundreds of residential consumer complaints concerning the unfair and deceptive conduct of competitive electricity supply companies and has returned millions of dollars to consumers impacted by these practices. In January 2015, Just Energy agreed to pay $4 million in restitution to consumers for deceptive marketing and sales, entering consumers into agreements without their consent, and charging costly termination fees. The AG’s Office also reached a $5 million settlement with Viridian Energy LLC in March 2018 for allegedly engaging in various deceptive and unfair sales tactics to switch consumers into costly contracts.

Any consumer or retailer with concerns about a competitive electric supplier using deceptive marketing practices should file a complaint with the AG’s Office or call the consumer hotline at (617) 727-8400. Consumers with questions can also contact the Consumer Division of the Department of Public Utilities at (877) 886-5066.

This case is being handled by Deputy Division Chief Nathan Forster, Assistant Attorneys General Alexander Early and Elizabeth Anderson, Investigator Kristen Salera, and Division Chief Rebecca Tepper and all of AG Healey’s Energy & Telecommunications Division.

 


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