Propane Gas Supplier Settles with Attorney General’s Office
BALTIMORE, MD (August 6, 2008) - Attorney General Douglas F.
Gansler announced today that his Consumer Protection Division
has reached a settlement with
an Elkton, Maryland propane gas supplier over the company’s imposition
of a “Government Agency Regulatory Compliance fee" ( “Government
Compliance fees”). The company, Schagrin Gas Company, Inc., agreed
to stop charging its customers fees unless they were previously disclosed
in their service agreements. The company will also provide its existing customers
with a credit for the Government Compliance fees that they were previously
Schagrin Gas Company, Inc., at 226 South Bridge Street in Elkton,
provides liquid propane gas to over 17,000 customers in Maryland.
The Consumer Protection Division alleged that Schagrin Gas violated
the Maryland Consumer Protection Act by having consumers enter
into multi-year service agreements and then charging consumers
an additional Government Compliance fee, which had not been disclosed
in the contracts. The Division further alleged that Schagrin Gas
misstated the purpose and the reason of the fee to consumers.
Schagrin Gas denies it violated the law. However, in order to
settle the matter, it agreed to stop charging customers fees unless
the fee was first disclosed in its contracts, to not mislead consumers
concerning the purposes of any fees it charges, and to provide
its existing customers with account credit based on the Government
Compliance fees it had previously charged them. Under the settlement,
the company also agreed to pay the Consumer Protection Division
$3,000 for its costs.
“Consumers cannot be asked to pay fees unless they are
adequately disclosed in their service agreements," said Attorney
General Gansler. The Attorney General urged consumers to make sure
they know all of the fees before entering into a contract and then
to check all bills to make sure that they are only being charged
fees to which they agreed.