Peterson Oil Service Inc. of Worcester will pay $450,000 and be required to improve its record-keeping process to resolve allegations the company knowingly violated two statewide contracts for providing heating oil to state entities, Attorney General Maura Healey’s office announced on Wednesday.
According to Healey, Peterson Oil regularly delivered fuel containing significantly more biodiesel by volume than the 5% allowed under two contracts covering an eight-year period. Healey’s offices alleges Peterson Oil entered into the contracts with the state’s Operational Services Division with no intention of providing compliant heating fuel and, at times, delivered fuel containing eight times the allowable biodiesel by volume under the agreement.
Several of the state entities Peterson provided heating fuel to subsequently experienced performance issues with their heating systems because of the high biodiesel content, according to Healey. At the same time, the Attorney General said Peterson knowingly submitted false documents over the course of its contracts claiming to deliver compliant oil when it had not.
“Cities and towns relied on Peterson Oil to deliver heating fuel in accordance with its contract so they could stay warm, but they instead received noncompliant fuel that caused problems for many heating systems,” Healey said in a press release. “Those who accept taxpayer dollars to contract with our state have a duty to operate with integrity and fulfill those contracts.”