Preventing Fraudulent Utility Accounts

Oct 6, 2020 | Utility Operations

Before coming to work at United Systems, I had never once heard of fraudulent utility accounts. I quickly learned that this was a very serious and costly issue that many utilities face. Let me explain… we’re going to call our customer Judy. Judy doesn’t pay her bill, and her service gets shut off. Instead of paying the bill and the fee for reconnection, Judy comes in and opens an account in her boyfriend, John’s name. A couple of months go by, and John’s account gets shut off. Well, here come Judy and John, and they open an account in their son, Joe’s, name and the cycle continues. Accounts opened in roommates, spouses, and even kids names happen regularly. The delinquent amounts and disconnect/reconnect fees are never recovered, and the utility takes a loss.

Working closely with utilities over the last several years has led me to some best practices to avoid these types of fraudulent accounts.


First, you want to ensure that your CIS/utility billing software allows you to store customers’ driver’s licenses and related identification numbers, etc.

Second, you want to ensure that you are gathering and storing this information on the customer record. We suggest that if you have not been attaching this information to customer or account records, you update or add the info as you interact with customers— real-time.


graphic of a keyboard with a button labeled "fraud"

For an added step of security, scan an image of the customer’s driver’s license or I.D. Economical, high-speed I.D. scanners are most helpful to your CSR’s during this process.

Utilize CIS service applications and attach these images directly to their CIS billing account.

When a customer comes in to open a new account, look-up their service location of record to determine if there are any disconnected or delinquent accounts at that location.

Also, search by name to examine if they have additional accounts left delinquent at other service locations.

The key to overcoming fraudulent accounts is information. Ensuring that your CIS/billing software stores the necessary information and tracks relevant data on the customer, location, and billing account is essential.  This software functionality used in conjunction with the record keeping steps above can save your utility money in the long run!

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