North Country Fuel Company Fined For Deceptive Practices
Attorney General Spitzer today announced an agreement with a North Country fuel delivery service for defrauding its customers with promises of fixed prices.
Countryside Management Corporation, Inc. of Fultonville settled allegations of false advertising, deceptive business practices and fraud for its marketing program that promised consumers capped prices for fuel oil and kerosene.
"Oversight of energy contracts has taken on an added importance because of skyrocketing prices," Spitzer said. "My office will scrutinize these offers and do everything possible to protect consumers against misrepresentations and fraud."
In May 2000, Countryside mailed out flyers to residents throughout the North Country offering a budget plan that would spread-out home fuel costs over a 10-month period and cap the prices. The offer also provided an alternative plan for delivery whereby the consumer provides a credit card for automatic deliveries at a capped price.
In mid-September, Countryside mailed its budget payment customers a letter stating that, due to soaring oil prices caused by low inventories, the company was canceling the capped price. Countryside gave its customers the choice to purchase fuel oil and kerosene at an increased price or to receive a refund, plus 4 percent interest.
Spitzer’s office objected to the cancellation on two grounds: Countryside failed to timely notify consumers that it intended to exercise its 30-day cancellation right found in the fine print of the contract; and it was considered to be deceptive not to include information in the advertising flyers about the cancellation period.
Further, customers were either forced to purchase fuel from a competitor at a higher price or to agree to Countryside’s increased price.
Under the settlement, Countryside agreed to provide refunds to consumers throughout the North Country for the difference between the price agreed to in the budget plan and the actual higher price they were forced to pay to a competitor or from Countryside due to the cancellation. This reimbursement covers fuel oil and kerosene deliveries received between October 1 and October 15, 2000.
Countryside also agreed to clearly and conspicuously disclose any limitations on its future offers and to pay $2,500 in civil penalties and costs.
This case was handled by Assistant Attorney General Glen F. Michaels of the Plattsburgh Regional Office under the direction of Assistant Attorney General in Charge Robert Glennon.
Individuals experiencing problems with their fuel delivery companies are encouraged to contact the Attorney General’s consumer help line at (800) 771-7755.