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Sounding the alert: Saving customers from scams

It’s the beginning of the lunch rush at a locally owned bakery. The cashiers are ringing up the long line of hungry patrons as fast as they can, and the phone is ringing off the hook with to-go orders. A frightened employee runs up to the owner and explains that the public power utility has just called to say that they’ve missed payments on their last power bill. If they don’t pay it over the phone within the next hour, they’ll have their power cut off — right in the middle of peak business hours.

The owner, who cannot handle one more thing going wrong that day, tells the employee to do whatever is needed to take care of the problem. If they lost power now, they’d lose out on hundreds of dollars in sales. It isn’t until they are closing shop for the day that the owner realizes her mistake. She has handed hundreds of dollars over to a scammer.

Over the past few years, scams targeting customers of public power utilities have been on the rise. The most common scam involves convincing customers to buy prepaid debit cards to cover a late bill.

“[Scammers] will call [customers] and say that their account is overdue and if they don’t pay a certain amount right then, they will be disconnected,” Gerri Boyce, media manager of JEA, explained. “They instruct the customer to go to a local store and buy a prepaid debit card and then call them back with the PIN to satisfy that payment.”

“They like to use scare tactics,” said Melissa Seifin, utilities communications supervisor at Anaheim Public Utilities. She recalled one instance where a scammer showed up in person at a victim’s home. “They said, ‘There’s a problem with some of your electrical equipment. It could catch fire, and we need to replace it right away.’” The scammer then went on to say that the customer needed to pay several hundred dollars immediately; otherwise, the house was in danger of catching fire.

Scammers tend to go after the most vulnerable members of a population: small businesses that rely on power to make sales, customers who don’t speak English as their first language, elderly customers, and low-income populations.

These last two in particular get targeted with scammers who use false empathy and convenience to worm their way in. Over the winter holidays, for example, scammers targeting Anaheim Public Utilities customers called and offered a “special Christmas package,” where the customers could prepay a certain amount and get a reduced rate — a huge incentive for families struggling to scrape together enough cash to pay for presents. “We had one instance where a gentleman went to an elderly customer’s home and said he was from the utility. He told her if she wanted to pay cash, he would pick it up and drop it off every month for her; he even gave her a ‘receipt,’” recounted Lisa Nugent, customer service manager at Anaheim.

Scammers are getting smarter and more sophisticated. “Working with other utilities, we’ve learned that some of these operations are very sophisticated, sometimes operating overseas with numerous employees,” explained Chris Capra, the public information specialist at Sacramento Municipal Utility District. “Just as technology has improved and become more affordable for the general population, so has it for scammers. To deceive customers and gain their trust, scammers now frequently provide a call-back number that is automatically answered by an interactive voice response system that mimics SMUD’s own system.”

Public power utilities employ a variety of strategies to stay ahead of scammers and keep customers informed.

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