Two energy firms fined for fraud

Canadian Press - June 20, 2003

Direct Energy Marketing Ltd. and Ontario Energy Savings Corp. have been fined a total of $232,500 after some of their agents apparently forged signatures on 31 consumer contracts, the Ontario Energy Board said today. Direct Energy was fined $7,500 for each of the 21 switched consumers and Ontario Energy Savings Corp. was fined the same amount for 10 switched consumers.

The Ontario Energy Board, an independent agency that oversees the province's $20-billion energy sector, said it had determined the signatures on the 31 contracts were forgeries and not those of the customers.

Both companies are entitled to a hearing before the board on the decision.

The board also said it has notified police of its findings.

A protocol to deal with complaints about marketing and energy supply contracts was established by the board last summer.

"Both Direct Energy and OESC have made significant efforts to comply with the protocol including removing the agents in question from service, cancelling the contracts in dispute and contacting other customers that were signed up by the agent to confirm the validity of their contracts," Mark Garner, the board's director of licensing, said in a news release. "However, our investigations led us to conclude that the size of the problem was unacceptable and was undermining consumer confidence in Ontario's retail energy markets."

Direct Energy Marketing Ltd., is an indirect wholly owned subsidiary of British energy retailing giant Centrica PLC. It acquired Direct Energy Ltd. in August 2000 as its first step into the North American market.

Ontario Energy Savings is wholly owned by the Energy Savings Income Fund. Units in the trust (TSE:SIF.UN) traded up seven cents today at $22.52 on the Toronto stock market.