Every year, utility scams trick thousands of Americans out of their hard-earned money. Reports that range from a woman in New York who lost $2,100, to businesses that have lost up to $15,000, emphasize that everyone is a target.
These con artists employ a variety of strategies and scare tactics to convince people to pay them or give away sensitive information. The best way to protect yourself against utility scams is to learn and understand these strategies.
The Most Common Utility Scam: The Imposter Scam
The majority of utility scams are imposter scams. An imposter scam is when someone tries to scam you by pretending to be someone they are not. In relation to utility scams, the imposter usually says they work at the utility company that serves your area.
It goes like this:
- You receive a call from your local utility company – Scammers use a technique called spoofing so your Caller ID recognizes it as a call from your local utility company
- The scammer says they work for your local utility company
- The scammer says that you’re overdue on your electricity bills
- The scammer says your service will be cut off if you don’t pay them immediately
- The scammer asks you to pay them – They will ask you to pay through a wire transfer, through a prepaid debit card, by giving your credit card information or some other method.
Utility scammers can be extremely convincing and will try to scare you into paying. They will say things like “the trucks are on their way to shut off your electricity right now.” They will call when you need your A/C or heat the most, to make the idea of your service being cut off even more painful. Today, they even use the COVID-19 pandemic to their advantage.
Why Imposter Scams Are Particularly Impactful During COVID-19
Many Americans are behind on their utility payments because they have been negatively impacted by the COVID-19 pandemic. This has made utility scams even more effective. Now, when a scammer says that you’re behind on your bills, you’re more likely to actually be behind, and therefore, you’re more likely to believe them.
It’s important to remember that your utility is not going to call you out of the blue and demand payment. Most utility companies right now have special COVID-19 payment plans that will help you pay off unpaid utility bills. You can contact your local utility provider for more information about those plans.
In-Person Imposter Scams
Before you learn how to protect yourself against utility imposter scams, it’s important to mention that scammers sometimes do them in person.
If they do, they usually come to your door pretending to be a worker for your utility company. They will then say that you’re behind on your bill, or they will “inspect” your home and say they need payment for something they “fixed.” Basically, they will use similar methods to scammers who call on the phone to try and take your money.
However, no matter the technique, you can protect yourself from these imposter scams by following the three steps below.
3 Steps To Protect Yourself From Utility Imposter Scams
There are three things that you should do to protect yourself from utility imposter scams:
- Don’t pay money or give any sensitive info to anyone over the phone or at your door – If you have payments to your utility company, you can pay them through your utility’s website.
- Confirm if you have payments yourself – You can do this by logging into your account or by calling your utility company. If you decide to call, find the number on your own by looking online or locating the utility’s number on your bill. Do not use a number that the potential scammer gives you.
- Remain calm and hang up/close the door – Remember, scammers will try to use scare tactics to get you to pay quickly without thinking. Your utility will not. Don’t be afraid to hang up the phone or close your door on a potential scammer.
Following these steps should keep you safe from any utility imposter scams that come your way. However, there are a few more things that you should keep in mind:
- Your utility will not shut off your service out of the blue – If you’re behind on your utility bills, you will receive multiple notices from your utility company. Your utility will give you plenty of warning about how much you need to pay, when you need to pay it by and when your service will be cut off if you don’t. If you receive a call that says they will be cutting off your service that day without prior warning, it’s a scam.
- Scammers often ask for payment by wire transfer, gift cards or prepaid cards – Utility companies will likely never ask you to pay using these methods. Remember, you can always pay online on your utility’s site. Anyone telling you otherwise is likely trying to trick you.
- Don’t let an unidentified utility worker on your property – If the utility company is performing a service at your home, they will schedule it in advance and tell you who is coming. This person will also have an ID card on them. When in doubt, close the door and call your utility company to confirm if the person is supposed to be there.
Door-To-Door Energy Provider Scams
States that have Energy Choice allow you to switch electricity providers to save on your bill. Many of these competing electricity providers have sales teams that go door-to-door selling their services.
Unfortunately, some of these salespeople try to scam people to sell electricity plans and increase their commission. States have cracked down on this, so it’s not as prevalent as it used to be, but it’s still something to be aware of. Here are some of the common methods these nefarious salespeople use:
- Slamming – This is when a salesperson switches your energy provider without your consent. They do this by asking for—or finding—your utility bill and copying down your utility number. With this info, they can switch your energy provider.
- Saying That You Must Switch – Some salespeople lie and say that you must switch providers. This is never the case. Texas and Georgia are the only states where you must pick an energy provider, and even then, you won’t be forced to go with one provider over another.
- Dishonest About A Plan – A sales rep may tell you that you will save if you switch providers, but is actually selling you a plan that costs substantially more.
How To Protect Yourself From These Door-To-Door Scams
To protect yourself from door-to-door scams, there are a few things that you can do:
- Don’t Give Them Your Bill – If they come up to your door, don’t hand them your bill unless you plan on switching providers. They won’t be able to switch your provider without it.
- Read The Full Contract If You Want To Switch – If you want to switch electricity providers, read the contract that you are signing so you can be sure that you’re getting the advertised rate.
- Consider Switching Providers Online – Switching platforms like ElectricityRates.com allow you to compare multiple providers and plans in your area so you can find the best plan for you.
The last point is probably the most important. If you want to switch providers, you’re better off doing it online where you can compare plans from multiple providers on your own time. This will allow you to move at your own pace and learn more about switching providers so you can be confident when you switch.
If you want to check out the plans in your area, enter your ZIP Code above.