Firm Accused of Energy Scheme Will Halt Activities

A Pennsylvania multilevel marketing firm accused of running an illegal pyramid scheme to sell electricity distributorships in California’s soon-to-be deregulated market agreed Friday to suspend operations until a hearing later this month before the California Public Utilities Commission.

At a hearing Friday morning before Commissioner Josiah L. Neeper and a PUC administrative law judge, Boston-Finney Inc. and its president, Christopher S. Mee, agreed to restrictions on operations that put the firm out of business in California until a hearing set for Feb. 25 and 26.

Boston-Finney is one of more than 250 new energy service providers registered in California to compete with the state’s big investor-owned utilities to sell electricity to business and residential customers when the market opens after March 31. California Atty. Gen. Dan Lungren sued Boston-Finney last month, accusing the firm of operating an “endless chain” scheme and making misleading statements about its ability to deliver electricity, to save customers money and to create earnings for distributors.

“They’re not doing business,” said Wilson Lewis, acting supervisor of PUC’s enforcement branch. “Today was not about punishing Boston-Finney, although that may come later. Today was about protecting the public from any immediate harm.”

A lawyer representing Boston-Finney declined comment except to say that “we’re happy the PUC granted a continuance to protect our due process rights.”

Boston-Finney agreed to stop recruiting California residents to become distributors for the company, stop recruiting retail electricity customers, stop processing fees or payments from potential distributors or retail customers and stop submitting service requests to utilities on behalf of customers it already has signed up. Boston-Finney has been charging each new account executive $295 and promising commissions for recruiting other account executives or retail electricity customers.

Mee, whom regulators said is 19 years old, did not speak at the hearing.

The PUC and the attorney general’s office have said they are investigating other energy marketers who may be defrauding customers.

PUC President Richard A. Bilas acknowledged Thursday that the agency’s process of screening prospective power suppliers has not been rigorous enough. The PUC is tightening up the process and will reexamine previous applicants, he said.