Fraudulent sales of home alarm systems are on the rise nationwide

News flash: Some salespeople are jerks and a surprisingly large amount are actual criminals. A new report from the Consumer Federation of America (CFA) finds that door-to-door alarm system sales are a major new source of concern for consumers. The firm’s 2017 Consumer Complaint Survey Report says that alarm system sales initiated by telemarketing, direct mail or salespeople going door to door are a new source of fraud.

“The complaints involve the use of scare tactics and misleading claims, lack of full disclosure about the costs and terms of the transactions, failure to provide notice of consumers’ cancellation rights, and locking consumers into long-term, automatically renewing contracts,” the report reads.

The report lists half a dozen real-world examples of rip-off artists goading or conniving homeowners, often the elderly or infirm, into signing fraudulent contracts. A man in Arkansas agreed to buy an alarm system but didn’t receive his copy of the contract, discovering the price doubled when it arrived. The Arkansas Attorney General’s office negotiated with the company to cancel the contract, remove the system, and refund the $4,927 the man paid.

The Georgia Department of Law’s Consumer Protection Unit obtained a $500,000 judgment against two companies with widespread misrepresentation including falsely claiming the level of criminal activity in local neighborhoods had increased and using handheld devices to make the contracts with consumers electronically.

In Ohio, the Cuyahoga County Department of Consumer Affairs uncovered some fraudsters who were sending letters that appeared to come from the county government, telling nearly 900 new home buyers that their neighborhoods were unsafe because of the “opioid crisis,” and informing residents they qualified for “free” alarm systems as part of a countywide program.

How do these bad actors know which alarm company you have? More than likely, you have it advertised in your front yard or in your window. Alarm companies often place signs declaring that a home is protected by the alarm system, nominally as a deterrent to would-be criminals, but it also makes great advertising.

Don’t get pinched by these idiots. First of all, don’t let these guys into your home. You should never let a salesperson into your house unless you’re interested and you have first asked for and received written information about the offer, including all costs. Door-to-door con artists will often try to convince you that they are working with your current alarm company to “upgrade” your system. Fall for this clumsy scheme and you will just end up getting double-billed by your current alarm company and your “new” one.

Google is your friend. If you’re approached by an alarm system sales rep, run the company through the Better Business Bureau, get references, and contact your local police and fire departments to ask whether you need to register your system and if they’re aware of the alarm company’s presence in your community. At the very least, search for “company name” and “scam,” and you should have a pretty good idea right away who you’re dealing with.

Other danger signs to watch for include salespeople showing up at your door unexpectedly; claims you have been specially selected for this offer or it’s a limited-time offer; the use of scare tactics about crime in your area; and pressure to sign a contract immediately.

Also remember that door-to-door purchases of $25 or more are subject to the Federal Trade Commission’s Cooling-Off Rule, which grants consumers the right to cancel any purchase within three business days, requiring a full refund.