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.
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- Two utility scams to look out for are imposter scams and door-to-door energy provider scams.
- Imposter scams involve a person pretending to be from your utility in order to get sensitive info from you, either through phone, email or in-person.
- Avoid imposter scams by only paying your bills directly through your utility provider's website. Don't give sensitive info over the phone, through an email/email link or to a person directly.
- Door-to-door energy provider scams involve an unethical salesperson knocking on your door and trying to get you to switch electricity providers and doing so without your permission.
- Avoid door-to-door energy provider scams by not giving your electric bill to anyone at your door and by using an electricity shopping platform if you want to switch providers.
The Most Common Utility Scam: The Imposter Scam
A utility imposter scam involves a person pretending to be from your utility provider in an attempt to get sensitive information from you. They often start by telling you that you're behind on your bill or that you need to pay for some electricity service they performed at your property. Then, they will tell you that failure to pay this bill will result in your power being cut off.
Imposter scams come in many forms, including over the phone, in-person and through email.
Imposter Scam: Phone
A utility imposter scam through the phone usually goes like this:
- You receive a call from what looks like your local utility company (scammers use a technique called spoofing so your Caller ID recognizes it as a call from your utility)
- 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
Utility scammers can be very convincing, often using scare tactics to get you to pay. They will say things like "the trucks are on their way to shut off your electricity right now". Sometimes they will call when you need your A/C or heat the most in order to make the idea of your service being cut off even more painful.
Imposter Scam: In-Person
Sometimes a person will come up to your door pretending to be a worker for your utility company. They will 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.
Imposter Scam: Email
The last type of imposter scam is through email. Like the two methods outlined above, this is a fake email that looks like it's sent from your utility company. It often states that your bill is overdue, that there's something wrong with your account or that your bill info is out of date.
From there, the imposter will usually ask you to follow a link and enter sensitive information like your credit card. They may even try to get you to download a piece of malware that can steal that info through your computer.
This is called phishing, and it's not a scam solely dedicated to the utility industry. There are a few ways that you can spot phishing scams, but the easiest way to avoid utility phishing scams is by following the next step.
How To Protect Yourself From Utility Imposter Scams
The easiest way to protect yourself from imposter scams is by going to your utility provider's website and logging into your account. Any payments or problems with your account will show up there, allowing you to securely handle them through the website.
Do not pay or provide any sensitive information through the phone, to someone at your door or through email/an email link.
If you're concerned that someone is attempting to scam you and want to talk to someone who works for the utility company to clear things up, call the utility's customer service line directly. You can find this number on the utility's website, and they should be able to answer any questions you may have.
Here are a few other things to 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 foror findingyour 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 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.