If you were watching Good Morning America (GMA) this morning, as you munched on your Wheaties you likely saw investigative journalist Brian Ross in a story reporting on an ABC News investigation into the sales practices of security supplier Vivint. The investigation was launched when ABC News learned of military families who claimed the company was lying to them and engaging in unfair sales practices.
See more on this reputation-damaging report from the nation’s top morning show…
Vivint is a large Utah-based supplier of security systems (and now solar panels in a division spun off this year) that prior to 2011 was known as APX Alarm. The company became more known in our industry as they were the sellers of a division called 2GIG Technologies, which was acquired by Nortek in 2013 – and now is part of their Linear division.
According to the report on GMA, Vivint markets to the military channel and its salespeople pursue military families as many soldiers deployed overseas seek alternate ways to protect their families while they are away. Ross told viewers that a prime concern of military families is what happens to their contract if they are redeployed.
Ross said that multiple families contacted ABC News and told them that their Vivint salesperson assured them that there was no problem, if they are redeployed the company had options for these families including cancelling the contract, if necessary. But when that time came, as it often does with military families who are often moved around frequently, the company refused to release them from their contracts – often demanding a lump sum payment of thousands of dollars to cancel the obligation.
Ross went on to tell GMA viewers that Vivint is under investigation by no fewer than nine attorneys-general from around the country for a variety of claims, including unethical sales practices. ABC News has a service called the Fixer which seeks to help consumers with action and advice if they feel they’ve been wronged. It was under the auspices of the Fixer that GMA intervened with Vivint of behalf of a group of military families.
Ross reported that after Vivint was contacted by the Fixer, they agreed to refund all of the specific families that had contacted ABC News. Situation resolved – for these families at least. But damage done to Vivint’s reputation.
The damning and damaging report by GMA is likely to have a serious impact on Vivint for some time to come and could be the greatest challenge to their public image they’ve ever faced. Ross’ report included imagery of struggling military families, dealing with issues beyond the grasp of most of us – facing unmitigated ugliness and greed from Vivint. The imagery and language were all designed to elicit sympathy for the families in this story.
Vivint is owned by the Blackstone Group LP which purchased the company in 2012 for $1.9 billion. The solar panel business was spun off this year to pay off some of the debt that Blackstone took on in the initial purchase, according to a report by Bloomberg. Blackstone reaped a $1.1 billion gain when Vivint Solar went public, Bloomberg said.