Herring announces settlement with home alarm company for alleged bait and switch tactics
Attorney General Mark Herring announced today that he has reached a settlement with Trio Alarm, LLC (Trio Alarm), a Wisconsin-based seller of home security systems, for alleged violations of the Virginia Consumer Protection Act (VCPA) and the state’s “bait and switch” statute.
Trio Alarm allegedly used door-to-door sales to target consumers displaying competitors’ security system yard signs in order to trick customers, particularly older Virginians, into entering long-term contracts they either didn’t want or didn’t need. Under the terms of the settlement, Virginia consumers who were victims are eligible for restitution and modification of their contracts, including customers who file a complaint with the Office of Attorney General in the next six months.
“Unfortunately, we hear about these sort of operations all the time,” said Attorney General Herring. “It’s so important for consumers to verify the claims of a salesperson and resist pressure to sign or agree to something right away. The folks who run these kinds of operations count on consumers feeling overwhelmed and pressured and that’s when you run into problems. If they are a legitimate company they will be willing to provide you a written offer to consider for 24 hours. In this particular instance, we really need victims to contact us right away we can still help them get out from under their extra contact and provide restitution under the terms of our settlement.”
According to documents filed in Newport News Circuit Court and complaints filed with the Virginia Attorney General’s Office, the Better Business Bureau, and the Virginia Department of Criminal Justice Services, Virginia consumers were tricked into signing long-term contracts, typically five years, with Trio Alarm, in many cases locking them into two long-term contracts with separate companies.
Attorney General Herring’s complaint alleges that trained sales professionals for Trio Alarm targeted consumers whose homes displayed signs for competing security systems and then gave them the impression that Trio Alarm was either their current alarm company or was affiliated with their current company. Some alleged tactics included false representations of free upgrades or updates to consumers’ current system, claims that Trio had purchased their existing security contract or that the contract had expired, claims that the salesperson worked for their alarm manufacturer, or claims that consumers’ service had been switched to Trio. Many consumers found themselves duped into paying for two security services at once or forced to pay expensive fees to get out of the contract.
The settlement includes the following key terms:
- A permanent injunction prohibiting Trio Alarm from engaging in violations of the VCPA and the state’s “bait and switch” statute.
- Trio Alarm agrees to provide refunds to Virginia consumers who suffered “monetary harm” as a result of its alleged violations of the VCPA or the “bait and switch” statute. “Monetary harm” includes double charges suffered by consumers as a result of their being simultaneously locked into two separate alarm monitoring agreements with different companies, and contractual buyouts paid by such consumers to Trio Alarm. The estimated restitution to consumers whose complaints currently are on file is $8,214.68 to 20 consumers. The Attorney General’s Office will disburse restitution to individual consumers.
- Trio Alarm further agrees to reimburse Virginia consumers who file qualifying complaints with the Virginia Attorney General’s Office within the next 180 days. The Attorney General’s Office will review subsequent complaints filed and determine whether those complaints qualify for restitution.
- For all consumers who file qualifying complaints with the Virginia Attorney General’s Office, Trio Alarm agrees to convert those consumers’ contracts to month-to-month agreements, allowing those consumers to terminate their agreements with no further obligation.
- Trio Alarm agrees to pay the Commonwealth a $6,250 civil penalty.
- Trio Alarm agrees to pay the Commonwealth $6,250 for reimbursement of the Commonwealth’s attorneys’ fees and costs.
Consumers who have complaints regarding Trio Alarm are encouraged to file written complaints with the Virginia Attorney General’s Office by visiting the website http://www.ag.virginia.gov. Consumers also may request complaint forms by contacting the Attorney General’s consumer hotline at (800) 552-9963.
The settlement, which is in the form of an Assurance of Voluntary Compliance, was filed for approval with the Newport News City Circuit Court on June 30, 2015. The Commonwealth is represented in this matter by Assistant Attorney General Mark S. Kubiak, with support from Consumer Protection Public Service Fellow Ty Henry.