Puget Sound Energy provided unauthorized information on thousands of its customers to an outside marketing company in exchange for revenue. Under a settlement approved by Washington State Utilities and Transportation Commission the energy company will pay a fine of $995,000 and will permanently abolish the program.
Puget Sound Energy is the largest and oldest energy utility in Washington State, serving over 100 cities and towns within 11 Washington counties. Customers are concerned that the fine to be paid by PSE will not find its way to those who were victims of the fraudulent marketing scheme. Over 342,000 customers receive both electric and natural gas service from PSE. The Washington State Utilities and Transportation Commission is the state agency in charge of regulating private, investor-owned electric and natural gas utilities in Washington
According to the settlement agreement, PSE will pay a penalty fee of $900,000 and contribute another $95,000 to its heating assistance program for low-income people. The utility company is prohibited from recouping these losses in future rate increases, and must notify all its customers of these penalties and the findings of company misconduct.
Puget Sound Energy shared customer data with Allconnect Inc, located in Georgia, between November 2001 and March 2006. Through its marketing program PSE Connections, the utility company has acknowledged transferring over 65,000 phone calls in addition to some basic information on customers. However, only 18,992 of the call transfers were subject to penalties by the commission because of a two-year statue of limitations. The contribution of $95,000 to low-income heating assistance is estimated to be the revenue earned by the utility company through the customer transfers.
Washington State law prohibits all privately owned gas and electric companies from releasing or selling customer data to any third party for marketing purposes without prior written permission from customers. The three-member commission concluded in its written decision that PSE “intentionally violated the rule as part of a corporate decision to sell its customers’ private information for financial gain.”
Utility spokeswoman Martha Monfreid said Monday that Puget Sound Energy will comply with the settlement. She said that the marketing program was immediately discontinued in March of 2006, “as soon as the commission raised the issue of there being privacy issues” pending a conclusion. The investigation that began in March was based on a report that Puget Sound Energy employees in their customer service call-center were transferring some calls and information to Allconnect.
For more information on the matter, contact Marilyn Meehan, (360) 664-1116 at the Washington State Utilities and Transportation Commission.
Associated Press, “PSE fined $995,000 for releasing users’ data.” URL: (http://www.theolympian.com/101/story/61909.html)
Meehan, Marilyn. Press Release docket Number U-061239, “State penalizes Puget Sound Energy $995,000 for illegal release of private customer data.” Washington Utilities and Transportation Commission. URL: (http://www.wutc.wa.gov/webimage.nsf/