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State continues to monitor Fred Fuller Oil

New Hampshire Union Leader

February 26. 2014 8:25PM

Fred Fuller Oil & Propane Co. so far has been meeting its contractual obligations to deliver oil to its prepaid home heating oil customers and the state will continue to closely monitor these agreements to ensure customers get all the oil they are owed this winter, the head of the state’s consumer protection division said Tuesday.

But the state will not be able to get a full accounting of the company’s business practices that led to a breakdown in delivering oil to customers during a bitter cold snap earlier this winter because it lacks authority to do so.

“The state is not privy to the inner workings of the Fred Fuller Co.,” said Senior Assistant Attorney General James T. Boffetti, who heads the consumer protection bureau.

The Attorney General’s office set out to do a complete investigation of why Fuller Oil failed to deliver oil to hundreds of customers whose tanks were at or near empty from mid-December through early January. Fuller Oil’s explanation that a failed telephone system caused the crisis only party explained what happened, Boffetti claimed earlier this month.

“In terms of providing a full, complete investigation of the inner workings of Fred Fuller Co., at the end of the day that’s an explanation he owes his customers,” Boffetti said.

But the law (RSA 339:79) does give the state authority to monitor prepaid home heating oil contracts in which customers pay in advance to buy a set amount of gallons of oil at a set price for the next heating season and the supporting futures contracts dealers are obliged to enter into with their suppliers, Boffetti said.

Fuller Oil has been providing bimonthly reports of all its prepaid contracts and corresponding futures contracts to the Attorney General’s office. The state reviewed a second report Friday which showed Fuller Oil continues to deliver oil it owes customers, Boffetti said.

“I’m happy to see he is delivering to those prebuy customers. They are the ones who tied up all their money. They are much more at risk than customers who pay as you go or even customers who pay on a budget plan. ... We want to make sure they are getting what they paid for and, every two weeks, we hope to see that (balance) reduced,” Boffetti said.

Boffetti said the state will continue to monitor prepaid contracts through the end of this heating season and will review prepaid home heating contracts and the futures contracts for the 2014-2015 heating season.

One of the state’s largest home heating oil dealers with an estimated 30,000 customers ranging from northern Massachusetts north to the Lakes Region and beyond, Fuller Oil failed to make deliveries to customers whose tanks went empty or near empty during a cold snap. Making matters worse, Fuller Oil’s telephone system failed, preventing customers from contacting the company, forcing the state to set up an emergency hotline to take calls from Fuller Oil customers who needed oil.

Fuller Oil agreed to pay back the state the estimated $21,000 it cost to run the emergency hotline for its customers for nearly six days in January. The hotline handled 3,832 calls.

Boffetti has often cautioned consumers about the risks of prepaid home heating oil contracts which he said provide little protection to consumers under current state law. The contracts obligate dealers to buy a certain number of gallons of oil at a certain price. But, Boffetti said, no money exchanges hands between dealers and suppliers and the dealers can use the customers’ money to cover current operating expenses.

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