ADT reaches $275,000 settlement in Missouri

Tuesday, April 1, 2003

ST. LOUIS - Since the passage of a tough no call law in July 2001, the Missouri Attorney General’s office has collected more than $1 million in penalties from telemarketers who have violated the law.

Now, ADT and more than 20 of its authorized dealers have been hit with a $275,000 penalty for what Attorney General Jay Nixon is calling multiple violations of the law. The penalty is the largest ever under the new law, eclipsing the $75,000 settlement reached in August 2001 with the Florida company that ran the Miss Cleo psychic hotline.

As part of a consent agreement recently approved by the St. Louis City District Court, the dealers agreed to make a $275,000 donation to the Merchandising Practices Revolving Fund, the fund that pays for no-call enforcement.

Scott Holste, a spokesperson for the attorney general’s office, said that while the agreement calls the $275,000 a donation, it should not be viewed as voluntary.

“I think in reality it is a penalty for having these calls made to people on the no-call list,” said Holste.

Some of the Missouri based dealers named in the settlement include: C & S Security Systems, Capital Communications, Home Protection, Kansas City Security Systems, Metro Security Services, Allied Home Security Multilink Security Service, Scharig Alarm Systems, Typhoon Security and Westplex Security.

The settlement also included dealers who were based outside of Missouri, but made calls to Missouri residents. The consent agreement names dealers based in Kansas, Georgia, Arkansas, Tennessee, California, Oregon, and Oklahoma.

Holste said the calls in question were primarily repeated sales calls, though he said some residents had raised concerns regarding the nature of the calls. While Holste would not comment on any further investigation, he expects there could be further developments as the investigation continues.

The attorney general’s office filed the lawsuit after receiving more than 200 complaints from residents who received telemarketing calls from ADT and its authorized dealers after they asked to be placed on the state’s do-not-call list.

“When people sign up for the no call list, they are saying don’t call us in no uncertain terms,” said Nixon. “This settlement sends the message that telemarketers who violate our no call law can pay huge consequences.

“The alarm bells should have been going off at ADT on this one,” continued Nixon.

An ADT spokesperson declined to comment on the settlement beyond a one-page statement that said the company and its dealers voluntarily entered into the settlement in an effort to avoid litigation.

“ADT Security Services Inc. has established that it did not violate the Missouri statute and admits to no wrongdoing in the consent judgment,” said the written statement, which was not attributed.

The ADT statement also said as soon as the company became aware of the telemarketing complaints it took corrective action, including issuing a letter to all local dealers informing them that they were required to comply with the no-call law.

“ADT Security Services requires that all its independent dealers adhere to the laws of the states in which they operate,” continued the statement, which also said that the company actively participates in no-call lists and keeps an active database of numbers in its do-not-call file.

The following dealers were named as part of the $275,000 settlement between ADT and the Missouri Attorney General’s office for violations of the state’s no-call law.

- 24/7 Protection Service, Olathe, Kan.
- Advantage Home Security, Lawrenceville, Ga.
- Angel Security, Jonesboro, Ark.
- C & S Security Systems, Inc. d/b/a Premier Security Services, Maryland Heights, Mo.
- Capitol Communications, Fulton, Mo.
- Direct Security Services, Lenexa, Kan.
- Home Protection, Inc., St. Louis, Mo.
- Kansas City Security Systems, Joplin, Mo.
- Metro Electronics, LLC d/b/a Metro Security Services, St. Charles, Mo.
- Midwest Digital Communications, LLC, Shawnee, Kan.
- Misharken, Inc. d/b/a Allied Home Security, Maryland Heights, Mo.
- MultiLink Security Service, LLC, Maryland Heights, Mo.
- Roberts & Todd Security Systems, Jackson, Tenn.
- Safe Home Security, Lenexa, Kan.
- Safe Haven Security, Sacramento, Calif.
- Scharig Alarm Systems, Inc., Independence, Mo.
- Security Alert, Memphis, Tenn.
- Security On-Line Corp., Little Rock, Ark.
- Typhoon Security, St. Louis, Mo.
- Westplex Security, Wright City, Mo.
- JRS Alarm Systems, Spring Hill, Kan.
- Universal Security Alarms, West, Inc. d/b/a USA West, Sandy, Oregon
- U.S. Security, Inc., Oklahoma City, Okla.