Lawsuits claim companies made deceptive sales to senior citizensMinnesota Attorney General Lori Swanson filed two lawsuits this week against separate Utah and Arizona companies that deceptively sold home security alarm and medical safety products to senior citizens in Minnesota.
By: Staff Report, Alexandria Echo Press
Warning that aggressive door-to-door salespeople and telemarketers often target senior citizens with the sale of costly and deceptively-marketed products by exploiting their fears about their personal or medical safety, Minnesota Attorney General Lori Swanson filed two lawsuits this week against separate Utah and Arizona companies that deceptively sold home security alarm and medical safety products to senior citizens in Minnesota.
“Senior citizens often fear for their personal safety at home or their medical safety in an emergency. Some companies exploit these safety concerns by using high-pressure sales tactics to deceptively peddle costly products over the phone or at people’s doorsteps,” said Attorney General Swanson. “It is not rude or impolite to close the door or hang up the phone on these high-pressure sales pitches,” she added.
The first lawsuit – filed against AMP Alarm, LLC of Utah – alleges that the company deceptively sold home security alarms and related long-term alarm monitoring agreements to Minnesota residents that cost up to $2,300. AMP makes unsolicited door-to-door “cold calls” on Minnesota homeowners, many of them elderly and on fixed incomes, in an attempt to sell security alarms and long-term agreements that cost up to $48 per month and last up to five years.
The lawsuit alleges that AMP salespeople often talk their way into peoples’ homes after failing to provide the disclosures required under the Minnesota Personal Solicitation of Sales Act or after using “bait and switch” tactics. The Act requires sales agents who make unsolicited “cold calls” at peoples’ homes to provide their name, business represented, product being sold, the fact they are trying to sell a product, and written identification before starting a sales pitch, so as to put the homeowner on guard against letting unwanted salespeople in their home.
In some cases, AMP falsely told consumers it was affiliated with their current alarm company or that its alarm systems were “free,” without disclosing that, in order to get the alarm hardware, people must sign long-term monitoring contracts, Swanson said. It also used high-pressure sales tactics with some citizens, including showing up at their homes late at night, walking into homes without an invitation, refusing to leave until the homeowner signed a contract, and intimidating them by calling installers before the consumer had agreed to anything, according to the lawsuit.
The lawsuit contends that the company often failed to orally inform customers that, if they did not cancel within three days, they were locking themselves into contracts of up to five years under which they must pay a penalty equal 80 percent of all future monthly payments (often $2,000 or more) should they wish to cancel. (Some of AMP’s customers are in their 80s and are not sure they will be alive or living in their homes in five years, Swanson said).
There have been consumer warnings around the country about alarm companies that use traveling salespeople to make unsolicited door-to-door sales calls that deceptively lock people into long-term contracts.
The second lawsuit—filed against EMT Medical, Inc. of Arizona—alleges that the company deceptively sold what it pitched as an emergency medical safety product for $398 through which citizens’ medical information could purportedly be immediately accessed by first responders in an emergency.
In fact, EMT’s product is merely an online medical storage product, according to the lawsuit. Many of EMT’s customers are senior citizens who do not use computers or the Internet, and over 85 percent never inputted their medical information into EMT’s online database after signing up, Swanson said.
Swanson said that among other things, the company uses frightening statistics about medical errors to pitch its products, such as “98,000 Americans die each year because of medical mistakes,” “1.5 million drug mishaps happen each year,” and “medical mistakes kill more people each year than breast cancer or motor vehicle accidents.”
EMT pushes people to buy its product on the spot over the phone and will not send written materials for people to look over in advance of a purchase, the lawsuit claims. EMT has misled some senior citizens into believing that it is affiliated with or connected to hospitals, paramedics, and emergency responders, according to Swanson. She said it has made no contact with Minnesota hospitals, paramedics or emergency responders to encourage use of its products and was unable to describe to the state any instance in which emergency personnel accessed its database to assist in the treatment of a Minnesota patient.
Swanson said EMT has falsely told other Minnesota senior citizens that a new federal law was passed that requires purchase of its product; that purchase of its product was required by Medicare; that purchase of the product was required because the person was over age 65; and that paramedics would not come to a person’s home if they did not buy the product.
Both lawsuits were filed in Hennepin County District Court and seek injunctive relief, restitution, and civil penalties. Both lawsuits allege that the companies violated Minnesota laws against deceptive trade practices and consumer fraud. The lawsuit against AMP also alleges that it violated Minnesota’s Personal Solicitation of Sales Act.