True Crime: How to Spot a Utility Scam
Updated: Aug 26, 2019
By: Diane Dove with the Better Business Bureau Serving Central Indiana
Scammers work year-round to defraud people, but utility scams are more common during the summer and winter, when folks rely heavily on their heating and air conditioning systems. Criminals use tactics, like impersonating utility company representatives, as a way to steal money from their victims. Con artists may threaten to take immediate action - such as shutting off your power - in order to get you to send money.
To help you understand how these scams work, the Better Business Bureau Serving Central Indiana provides a real report from their Scam Tracker. The Scam Tracker is filled with information on trending scams in your area. This specific report was filed in Central Indianapolis, but reports of these scams can be found all across the state of Indiana.
Real Scam Report
In June 2018, an Indianapolis small business owner received a voicemail from Samantha Reid. The message said Reid was calling from Indianapolis Power & Light Company (IPL) to inform the business that the electricity for the commercial building would be cut off in 45 minutes unless a payment was received.
The business owner was out of town for work and did not have a copy of the IPL bill to reference the disconnect date. The business owner returned Reid's call and offered to make an online payment. Reid told the business owner not to pay online, because the online payment takes 48 hours to process, and the technicians were already on their way to cut off the electricity. The business owner explained to Reid that they were in Boston to attend an important seminar and asked if Reid could give them until tomorrow morning to pay, as they did not have a means of transportation while at the conference. Reid declined and told the business owner to take an Uber to go to CVS, purchase Green Dot cards, and call her before 6:00 PM to pay $1,500, including the deposit.
Fearing a big impact on the business if it lost electricity, the business owner left the seminar, paid for a $31 Uber ride, and went to CVS. The business owner did not know how Green Dot debit cards function, but Reid instructed the owner to use an ATM to take out cash and load the money onto the prepaid Green Dot debit cards. The business owner had to use three ATM cards to get the cash. Due to daily limits on the debit cards, the business owner was not able to get all the cash out. The business owner called Reid back to process what they could get: $1,450. Reid was disappointed the Green Dot debit card was Visa and not MasterCard, but that was all CVS had. Reid told the business owner she would have to make special arrangements to accept Visa cards. After Reid processed the Green Dot debit card, Reid told the business owner that she would put a hold on the other commercial account the business owner had. Reid told the business owner that they needed to pay and additional $1,232 to remove the disconnect status.
When the business owner returned from the trip, they checked their IPL account and did not see the payment of $1,450 posted. When the business owner called IPL customer service, they were told no one from IPL had called, and their bill was not due for two more days. The IPL customer service representative told the business owner that many IPL customers were getting these type of scam calls.
How to Spot These Scams
Con artists aren't just targeting people over the phone. Scammers use a variety of tricks to prey on utility customers. A "representative" may appear at your door in a plausible work uniform, claiming that the electric meter is not working properly and must be replaced immediately - at your expense. In a particularly alarming form of this con, the scammer may gain access to your home, claiming they need to make repairs or perform an energy audit, with the intent of stealing your valuables. These scams may also involve promises of energy discounts with the aim of taking your money, personal information, or possibly the account details needed to switch you to another utility provider without your consent (an illegal practice known as "slamming").
Don't assume the name/number on the caller I.D. is legitimate. This can be spoofed to appear like your utility company is the caller.
Never allow anyone into your home unless you have scheduled an appointment or reported a problem. Also, ask utility employees for proper identification before letting them enter.
Do not provide a prepaid card, wire transfer, or any other form of payment over the phone. These transactions may be difficult for law enforcement officials to trace.
Do not fall for the threat to turn off your power if you don't pay immediately. Even if it might be possible that you do have a past-due balance that needs to be paid, most companies provide past-due notices in writing before shutting off service, not just a single notification one hour before disconnection.
If you are concerned there truly might be a problem with your account, contact your provider by calling the number listed on your monthly bill.
If you suspect you have been impacted by a scam, notify your utility company of the impostor. Report it to your local police department and to the Better Business Bureau and/or the Federal Trade Commission.