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The Illinois Attorney General (AG) filed a suit in Cook County, IL circuit court against Southeast Energy Consultants, LLC (SEC or Defendant), for alleged violations of the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505/1 et seq. (CFA), and the Illinois Telephone Solicitations Act, 815 ILCS 413/1 et seq. (TSA).

Excerpts from the Illinois Attorney General (AG) Press Release:

“According to Raoul’s office, SEC is a third-party vendor based in Florida that has contracted with ARES for more than 10 years, providing telemarketing services targeting Illinois consumers. In addition to defrauding Illinois consumers with promises of savings, Raoul’s lawsuit also alleges SEC made numerous false statements to mislead consumers to believe its agents were affiliated with local public utility companies who were calling to enroll them in an official state-sponsored program that would provide cost savings.”

“Attorney General Raoul’s lawsuit seeks to stop SEC’s illegal conduct and recover the hundreds of thousands of dollars in increased costs Illinois consumers have paid as a result. Raoul’s suit also seeks penalties, including $50,000 for each statutory violation committed against an older Illinois resident.”

“Attorney General Raoul’s lawsuit against SEC is the latest action he has taken to protect Illinois residents from deceptive practices by ARES. In 2023, Raoul sued Residents Energy LLC over allegations the company’s telemarketers and in-person sales agents used deceptive and unfair tactics to switch customers from their public utility companies to more expensive contracts with Residents. In 2020, Raoul’s office filed a lawsuit against Liberty Power Holdings LLC alleging the company deceived tens of thousands of Illinois residents into signing contracts based on false promises Liberty would save them money on their electricity bills. The Attorney General’s office previously settled lawsuits with, or investigations into Major Energy Electric Services LLC, Eligo Energy IL LLC,  Realgy LLC, Atlantic Energy MD LLC, Palmco Power IL LLC, IDT Energy INC., Sperian Energy Corp., and Mega Energy of Illinois. The Attorney General’s office is pursuing investigations into other ARES.” 

“Thousands of Illinoisans were contacted by SEC with promises of lower electricity rates and overall cost savings on their energy bills. In reality, consumers ended up paying more in energy costs than if they had stayed with their public utility company,” said Illinois Attorney General Kwame Raoul. “My office is committed to protecting Illinois consumers from deceptive practices utilized by alternative retail electric suppliers and their vendors, and preventing consumers from overpaying for the energy they need.” {***}

Note that the AG’s suit does not cite a specific total amount sought under civil penalties, but, among other additional penalties, seeks $50,000 per relevant violation.  

Also note that as of publication time, the Illinois AG has not announced any new actions against any of the named retail supplier clients of SEC referenced above.

Among Relief Sought, IL AG Seeks:

• a permanent injunction barring Defendant from engaging in the sale of electric supply in or from the State of Illinois;
• revocation of all licenses, charters, franchises, certificates, or other evidence of authority of Defendant to do business in the State of Illinois
• rescission of contracts entered between the Defendant and Illinois consumers,” as well as the refund of monies paid, and the disgorgement of ill-gotten monies.

Excerpts of Alleged Violations:
“Among other practices, SEC marketed ARES’ services by claiming consumers would save money on their electric bills. As a result, Illinois residents were often defrauded into purchasing high-cost electricity supply service.”

“SEC agents promised a guaranteed rate reduction or savings on the consumers’ electricity rates through ComEd or Ameren,” when no such guaranteed or savings existed. As an example, the AG alleged, “An SEC agent, calling on behalf of Atlantic Energy, asked a consumer, Hugh, ‘you don’t want to save money on your electric bill’ when the consumer became uninterested in the call. The consumer remained on the line, and the SEC agent offered him a rate of 9 cents per kilowatt hour for 24 months. ComEd’s rate during the time of SEC’s offer was less than 8.3 cents per kilowatt hour.”

“[C]alling on behalf of RPA Energy told a consumer that they only reason RPA couldn’t guarantee savings is because a consumer might have a massive increase in usage in a given month, but that otherwise the consumer would save money by switching to RPA Energy. This was false. The RPA Energy rate, 11.59 cents per kWh, was higher than ComEd’s rate at the time.”

“[C]alling on behalf of Indra Energy invited a consumer to switch from Ameren to get a ‘price protected rate.’ When the consumer asked if it would help save money, [SEC’s agent], said, ‘This will get you . . . yes. This will help you avoid any increases on the electric bill.’ This was false. The new ‘price protected’ rate was higher than the applicable Ameren rate. Even worse, the Indra agent never disclosed the new ‘price protected’ rate to the consumer. “

“SEC also made numerous false, deceptive, and misleading statements that led consumers to believe that its agents were affiliated with the default public utility company, and that the agents were calling to enroll them in an official state-sponsored program that would provide some cost-saving benefit.”

“[I]n 2019, SEC agents, on behalf of IG&E, routinely misrepresented an affiliation with the utility by telling consumers they were entitled to a refund check on their electricity bill — referring to the consumer’s ComEd or Ameren bill.”

“SEC also misrepresented an affiliation with the utility companies by referring to a non-existent ‘postcard,’ ‘insert,’ or ‘message’ included in the consumer’s utility bill that promised a rate reduction. Consumers regularly told SEC sales agents that they had never seen the referenced postcard, insert, or message. SEC trained its sales agents to respond by stating that many consumers had missed the insert or message.”

“Nothing in Illinois law entitles consumers to reductions on their electricity bills. While the deregulation of the utility market in 1997 allows Illinois consumers to choose their electric supplier, there is no state or energy ‘program.’ 220 ILCS 5/16-101 et seq.”

Examples of SEC agents’ alleged “misrepresentations about an ARES’s affiliation with a governmental body”:

• An SEC sales agent calling on behalf of Atlantic Energy told a consumer that ‘utilities in Illinois had put together the ‘state’s choice’ program for the consumer’s benefit.’ Continuing, the agent said that she was calling to ‘facilitate’ enrollment in the program, which was available to ‘ComEd and its consumers.’
• An SEC sales agent calling on behalf of Atlantic Energy promised a consumer that she would ‘save money’ in the ‘energy choice’ program.
• Another SEC agent informed the consumer, ‘Right now your state has an energy choice program going on, and they are trying to get you to pick a supplier on your bill. . . .’
• The AG also alleged, “SEC explicitly stated or implicitly conveyed it was affiliated with ComEd, Ameren, and a state-sponsored electricity program to lure consumers into trusting its sales pitch and switching to an ARES. SEC agents falsely represented an affiliation with the utility when they told consumers they were calling to follow up on a non-existent ‘insert,’ ‘postcard’ or ‘message’ included in the consumer’s electricity bill that explained their eligibility for a money saving program.”

SEC agents omit informing consumer of ‘purpose of call:

• The AG states that the TSA requires telemarketers to “state the purpose of the call” and to “inquire at the beginning of the call whether the person called consents to the solicitation.” 815 ILCS 413/15(b)(1)-(2).
• “SEC knowingly and intentionally made calls to consumers without stating the purpose of the call and requesting consent to continue with the solicitation. Indeed, it directed its sales agents to make illegal phone calls by providing them scripts that did not explain to consumers the purpose of the call or request consumer consent to continue with the solicitation.”

In addition, the AG alleges instances in which an SEC agent did not request consent to continue, and in which the SEC agent obfuscated the purpose of the call by stating that the agent was, “[j]ust following up on a postcard that was sent out to you regarding a refund check you are now entitled to receive on your electric bill.”

The AG’s lawsuit includes identification of an instance in which the SEC agent then admitted that they would be staying on the line during the third-party verification in violation of 815 ILCS 505/2EE(B). 

AG Press Release
2024CH04292 – Cook County Circuit Court  (05/08/2024)