No Compo for Fuel Oil Customers
Pre-paid heating oil contracts are a good way to lock in lower summer prices ahead of winter. But some customers have been left out of pocket when heating oil firms have gone out of business. (image: masslive.com)
The Pennsylvania attorney-general’s office is warning that thousands of customers who were cheated in a pre-paid heating oil scam are unlikely to be reimbursed.
Customers of A&B Fuel, whose advance heating fuel payments disappeared when the company’s owners skipped town, face little prospect of restitution, poconorecord.com reports.
A Wayne County court finalized the company’s bankruptcy in 2010, two years after owners Arthur and Beverly Baio of Gouldsboro filed for personal and corporate bankruptcy. Consumers filed millions of dollars in claims for prepaid heating oil and propane that went undelivered after the company suddenly stopped making fuel deliveries in December 2007. Thousands of customers who had pre-purchased winter oil and gas are thought to have been affected.
Complaints poured into the state attorney general’s office, which launched an investigation into A&B’s business practices. The state subsequently filed a lawsuit against the Baios for violating consumer protection laws. It accused them of deceptive business practices – knowingly accepting payment for a product or service they could not provide.
Though the couple filed for bankruptcy, putting the state’s case on hold, the bankruptcy court declared that the Baios were still responsible for $975,000 in debt. But Pennsylvania’s Senior Deputy Attorney-General J.P. McGowen this month wrote to cheated customers with claims against the company warning that no funds were available for restitution.
“I do caution, however, that the prospect of a significant recovery remains slight.”
The attorney general’s office had been unable to identify any assets that could be paid to creditors, including customers who were left without heat. The office would continue to monitor the Baios’ ongoing financial condition. If monies become available, the auditor-general would make a distribution to creditors, the letter said.
The case of A&B is sadly not an isolated one. With the global recession and volatile world oil prices, other heating oil firms have been caught short after taking money for advance oil delivery contracts which they later were unable to honor.
The situation has sparked warning about the danger of pre-paid heating oil contracts from the Maine attorney-general and attempts at tougher consumer protection legislation in New Hampshire. HeatingOil.com recommends customers compare heating oil dealers and study contracts before signing up to pre-paid oil agreements and make sure you only deal with reputable, licensed dealers.
Craig says: says:
That’s a very disappointing story. Getting involved in a prepaid contract is an extremely risky move because if the company goes under, the chance of you getting your money back is slim. I feel terrible for all of those families who not only have no oil, but they have also lost a lot of money for heating oil that they will never receive.