ADT puts deceptive sales practices in the crosshairs

Dec. 4, 2015
Company continues to wage its battle in the courtroom

Earlier this week, ADT announced that a U.S. District Court in Dallas had granted its request for a preliminary injunction against Tucson, Ariz.-based alarm dealer Capital Connect, barring the company and its sales agents from making false claims to ADT customers. Capital Connect is one of five alarm Monitronics International dealers which were sued by ADT earlier this summer for allegedly using deceptive sales practices as part of an effort to trick consumers into signing a new monitoring contract with their company.   

According to the lawsuit filed by ADT, the company has received more than 300 complaints from customers regarding false sales pitches made by Capital Connect reps since 2013. However, despite sending the company three cease and desist letters between October of 2014 and April 2015, ADT said Capital Connect’s acts of deception only intensified. In the seven weeks leading up the lawsuit being filed last July, ADT said that it had received over 90 reports from customers about Capital Connect’s sales practices.

In a statement provided by his attorney Andres Correa of the Lynn Tillotson Pinker & Cox law firm in Dallas, Capital Connect CEO Todd Johnson said that the company does not encourage the use of underhanded tactics by its representatives and employs various measures to ensure honest sales practices are followed.  

“Capital Connect does not condone or in any way encourage any false or misleading practices by its sales representatives. As the court’s preliminary ruling acknowledges, Capital Connect employs copious measures - such as training materials, sales ethics agreements, and quality assurance calls - to ensure ethical and truthful sales practices.  The court’s ruling is only preliminary, and Capital Connect looks forward to the opportunity to defend its sales practices at a full trial,” said Johnson.

While they had no comment on the lawsuit itself, Monitronics did issue a statement regarding the sales practices of its dealers.   

“We have no comment on pending or potential litigation. However, we are confident that our dealers uphold the highest standards of ethical behavior in our industry when it comes to sales tactics. We also believe that all companies can continue to improve upon how all dealers approach potential and existing customers,” read an official statement from Monitronics.

In addition to Capital Connect, ADT also named Power Home Technologies, Security Investments, Alliance Security, and Maximum Security Alarm in the lawsuit. Aside from prohibiting these companies from continuing to dupe its’ current customers, ADT is also seeking compensatory damages of up to $7 million as well as punitive damages in an amount sufficient to deter similar future behavior, according to the lawsuit.    

ADT’s Campaign Against Deceptive Sales Practices Sees Results

ADT has been at the forefront of the battle against deceptive sales practices in the alarm industry. In recent years the company has waged an aggressive campaign to educate consumers about some of the misleading tactics con-artists use to trick people into signing new security system contracts. Last year, ADT announced that it would offer an award of up to $25,000 for those who could provide evidence that a company is training its sales team members in deceitful sales practices.

Given all of the work the company has poured into stopping deceptive sales, ADT General Counsel David Bleisch said the preliminary injunction issued against Capital Connect gives the company a sense of encouragement about their efforts. 

“As you can imagine, it takes a lot of effort to collect the evidence and then go out and talk to the folks that need to be talked to confirm the claims of deceptive sales practices,” said Bleisch. “When we bring these cases we don’t bring them lightly. We’ve thought about it; put a lot of consideration into determining if the companies we pursue need to be pursued and it’s a positive sign for us to see that the court deems a preliminary injunction to be appropriate in this case. Part of the standard for a preliminary injunction is that there is a substantial likelihood that we will win on the merits of case when we ultimately go to trial, so we view it as a very good sign.”

Over the past three years, ADT has received nearly $6 million in settlements against companies that have made false or misleading statements while selling security services door-to-door. Additionally, ADT obtained court orders prohibiting the companies from using any further deceptive sales practices.

Bleisch recommends that consumers always ask for photo identification of any alarm salesperson or technician that shows up at their door and to not allow themselves to be pressured into signing any agreement. Among some of the most popular deceptive sales tactics, which are also highlighted in the allegations made in the lawsuit include:

  • Telling customers that ADT has either gone out of business or is in financial difficulty and informing them that a new company is taking over the accounts, which will require an upgrade of their equipment.
  • Sales agents misrepresenting themselves by telling customers they work for the manufacturer that makes their security system and informing them that they need to update their existing equipment.
  • Informing customers that they have either bought or merged with ADT as part of an effort to get them to upgrade their alarm system.

Bleisch credited increased industry awareness raised by this issue with aiding them in bringing such cases to court.        

“More people are aware of when somebody is trying to scam them and report it more often than they otherwise would,” he added. “Not only have we received more reports of scams, but we’re finding that more people are not falling for the scam -- which is a good thing. Unfortunately, far too many people are falling for them. This is why salesmen are still using these deceptive sales practices and we’re going to continue to bring cases against companies that use deceptive sales practices until they end. We are also hopeful that consumer awareness will continue to rise such that people won’t be scammed.”

About the Author

Joel Griffin | Editor-in-Chief,

Joel Griffin is the Editor-in-Chief of, a business-to-business news website published by Endeavor Business Media that covers all aspects of the physical security industry. Joel has covered the security industry since May 2008 when he first joined the site as assistant editor. Prior to SecurityInfoWatch, Joel worked as a staff reporter for two years at the Newton Citizen, a daily newspaper located in the suburban Atlanta city of Covington, Ga.