HOD Audits Could Cost Oil/Propane Dealers $500
The Connecticut Department of Consumer Protection (DCP) sent an audit letter to all registered heating oil and propane dealers (HOD’s) this week. The audit statement provided in the letter MUST be filled out, notarized, and either faxed or e-mailed to DCP by November 14th by ALL registered HOD’s regardless if you offer contract or not! DCP will NOT accept audit statements via US mail. Failure to send your audit statement via fax or e-mail by November 14th will result in a $500 fine – NO EXCEPTIONS! The letter explains that HOD’s who offer contracts during the 2015/2016 season will have to provide a “short statement” of the “method” that you used to secure your contract (ie, bond, futures contract, etc.) NEXT YEAR. You are NOT required to provide the statement of how you secured your contracts when you respond to this year audit.
As a reminder the law also requires that:
These law changes occurred after Ace Oil closed their doors last Fall. The closure resulted in hundreds of customers who paid the dealer a total of $1.5 million for prepay contract oil without delivering the fuel that they were promised. That event resulted in two major pieces of legislation being introduced. The intent of these bill was to "fix" the Ace Oil problem so that consumers will be protected from future failures. The first bill that was introduced, would have required home heating oil and propane dealers to obtain a bond to secure 100% of the fuel that their customers paid them for in advance of delivery. And the second bill, would have required every registered HOD in the state to pay an annual fee of nearly $4,000 to a guaranty fund. The guaranty fund legislation was designed to reimburse consumers who paid for fuel, but never received it. CEMA, successfully defeated both bills and saved our members thousands of dollars a year while maintaining a level playing field! Without this compromise, our industry would have been held financially responsible (through a $4,000 tax deposited into a guaranty fund) in the event that your competitors failure to honor their prepay contracts in the future.
- NO heating oil or propane dealer shall offer a prepay contracts from November 1st through March 31st (fixed price contracts and other guaranteed price contracts where a customers does not pay for the fuel in advance of delivery is permitted during these months);
- Prepaid contracts MUST include the following statement - "DISCLOSURE NOTICE CONCERNING CREDIT CARD PAYMENT OPTION. If you pay by credit card for a prepaid guaranteed heating fuel price plan contract, you may be entitled to recovery payments pursuant to the federal Fair Credit Billing Act or your credit card company's terms and conditions if heating fuel is not delivered to you in accordance with the contract."