« Energy Hedge Fund Center Now Tracking 450 Energy Hedge FundsPR Web (The Free Wire Service) Daily News Feed | Main | Congressional Testimony Reflects on Solar Decathlon »
December 07, 2005
Utility checking customer creditapp.com - Ocean
Is your power company peeking at your credit rating? The answer is yes, if you are one of First Energy Corporation's 3.6 million residential customers in New Jersey, Pennsylvania and Ohio. "The company has run a limited credit status check on all its residential customers this year," said Ron Morano, spokesman for Jersey Central Power & Light, First Energy's subsidiary in New Jersey. "The practice is legal and common." JCP&L services most of Monmouth and Ocean counties and has approximately 950,000 residential customers statewide — many of whom may not realize that the power company has run the checks. Russell K. Corby, the mayor of Pine Beach, said he was surprised to learn the power company had gained access to his credit report. "Not only did I not authorize First Energy to look at my credit report, I did not know they had done so — and I probably never would have found out if I hadn't accessed my free credit report," Corby said. Under the federal Fair and Accurate Credit Transactions Act of 2003, consumers have a right to a free report on the status of their credit every 12 months. In coordination with the Federal Trade Commission, the nation's three major credit report services — Equifax, Experian and TransUnion — have arranged to make free credit reports available through the Web site www.annualcreditreport.com. Corby visited that site in early October. When he was looking at Experian's report, he clicked a heading that took him to a list of the various entities to whom he had given permission to view his credit report. On that list was First Energy Service Corporation, another subsidiary of First Energy, which had no such permission but had inquired after Corby's credit status on May 13. "I was baffled," Corby said. "Why in the world would JCP&L want to know my credit rating? I've been paying my electric bills for 35 years. Wouldn't my billing record be enough? Also, did they have a right to the information?" They did, according to the Federal Trade Commission, which oversees the nation's credit reporting industry. "A utility company has the right under federal law to check on the credit status of new customers, because the utility industry depends on deferred payments when beginning service," said FTC spokesman Bill Haynes. "It is common practice to do a routine credit check." Though Corby is not a new customer, Haynes said power companies also have the right to seek the credit ratings of established customers for "an account review." "The customer's permission is not required in either case," Haynes said. Morano said First Energy has a contract with Experian whereby, when provided with a customer's name and Social Security number, Experian would supply not a complete credit report, but an "acceptable or unacceptable" status report. Morano said the company took these measures to identify new customers with credit problems because a monetary deposit is required from such potential risks. The credit check was done on established customers to ensure that they are who they say they are, Morano explained. Corby was not satisfied with First Energy's explanation of why they had checked his credit, and said he has written a letter to the state Board of Public Utilities questioning the practice. The BPU had just received the letter and had no comment Tuesday. Corby also questioned how First Energy acquired his Social Security number. "I don't remember giving it to them," he said. "I don't know how we may have gotten his Social Security number," Morano said. "He's been a customer over 30 years. At some point, we must have gotten it." Morano also had no answer as to how the other 3.6 million Social Security numbers were obtained. The FTC's Haynes said that there are many ways a corporation could obtain such information over the years. Morano explained that, although it is apparent to a consumer accessing his credit report that First Energy had also been there, nothing concerning First Energy's credit check would appear on the consumer reports Experian regularly generates to companies like banks, auto dealers and other potential lenders. "The credit checks are only for our company," Morano said. "They won't otherwise impact the consumer."Posted by dymaxion at December 7, 2005 04:44 PM