Reliance Requests Formal Inquiry under the Competition Act into misleading and abusive practices in door-to-door water heater rental sales

We received the following information from Reliance Home Comfort this morning. Please be advised that we are passing this information on as we are Service Agents for Reliance and this company mentioned (below) has also not only been misrepresenting Reliance but also have told customers in our service area that we would be doing the service for these National hot water heaters. To reassure our own customers and our customers through Reliance Home Comfort please be advised that –
We have NOTHING to do with National – never have and never will.

Below is from Reliance…

Reliance Requests Formal Inquiry under the Competition Act into misleading and abusive practices in door-to-door water heater rental sales

Earlier this week, we shared news that Reliance is suing National for using unfair practices and misleading representations including door-to-door selling practices that mislead customers. Today, the company issued the attached media release to announce that it has participated  in a formal six person complaint under Section 9 of the Competition Act that alleges that National and MorEnergy have breached the misleading provisions of the Competition Act.

We believe that taking action against these unlawful practices should be the priority of the Competition Bureau as these practices need to stop. Reliance’s participation in this formal complaint is part of our continued commitment to take a leadership role in cleaning up the industry and eliminating misleading sales practices by some of our competitors to the detriment of our customers. Reliance is working with the Ontario Ministry of Consumer Services on proposed regulatory amendments that will address many of the tactics used to mislead consumers approached by door-to-door sales people.

While I remind you that as a Reliance employee, it is inappropriate to speculate about or speak to the specifics of the company’s action against National, we do encourage you to advise your friends, family and neighbours to make them aware of any door knocking activity in your neighbourhood. Customers who feel they’ve been misled are encouraged to contact the Ministry of Consumer Services directly.

__________________________________________________________

Request for Formal Inquiry under the Competition Act into misleading and abusive practices in door-to-door water heater rental sales
Toronto, December 19, 2012 – Reliance Comfort Limited Partnership today announced that it has participated in a formal six person complaint under Section 9 of the Competition Act that alleges that National and MorEnergy have breached the misleading advertising provisions of the Competition Act.
Under Section 10 of the Competition Act the Commissioner is required upon application by six or more persons to undertake a formal inquiry and consider enforcement action. The Commissioner must also provide a formal report upon completion of the inquiry to the Minister of Industry, the Honourable Christian Paradis, who may require the Commissioner to undertake a further inquiry.

“We believe that taking action against these unlawful practices should be the priority of the Competition Bureau as these practices need to stop,” says Roger Rossi, President and CEO, Reliance Comfort Limited Partnership.
Consumer complaints regarding door-to-door tactics of some competitors are well documented:

Ontario Superior Court
 In July 2012, the Ontario Superior Court recently found that certain of National Home Service’s door-to-door sales tactics constituted a breach of section 52 of the Act. The relevant decision, Direct Energy Marketing Limited v. National Energy Corp, 2012 ONSC 4232 can be viewed at http://www.canlii.org/en/on/onsc/doc/2012/2012onsc4232/2012onsc4232.html.

Ontario Ministry of Consumer Services
 The Ontario Ministry of Consumer Services reports that water heater sales practices were the third most received consumer complaint in 2010 and were the subject of the second most received complaints in 2011. The Ministry reportedly received some 2,518 complaints in 2011. In 2012 complaints about water heater rental sales continue to be the second most frequent source of complaints to the Ministry. The Ministry has issued a Consumer Alert – Hot Water Rental. This alert is available on the Ministry’s website: http://www.sse.gov.on.ca/mcs/en/Pages/Consumer_Alert_Water_Heater.aspx.

 The Ministry has confirmed that it received120 separate written complaints about National’s practices in the first 10 months of this year.

Better Business Bureau
 The BBB reports that as at December 14, 2012, the BBB reported on its website that in the last three years it had received 103 complaints concerning National Home Services’ advertising and sales practices. A business alert contained on the site stated:
o BBB files indicate that this business has a pattern of complaints concerning misleading sales practices. Consumer complaints allege that door-to-door sales persons are misleading consumers, providing false information and using high pressure sales tactics. This company [National] was notified of our concerns on June 7, 2011. They have failed to correct the underlying reason for the complaints.

 As at December 14, 2012, the BBB reported on its website that in the last three years it had received 21 complaints concerning MorEnergy’s advertising and sales practices.
Police involvement

 In May of this year the Toronto Police Service issued a press release indicating that two salespersons acting on behalf of MorEnergy had been charged with attempted fraud for claiming they worked for Enbridge gas and advising the homeowner’s that there was a problem with their water heater to coerce them into signing a contract with MorEnergy. The Toronto Police Service issued the press release because they believe there were other victims of these fraudulent practices.

Generally, the issue of aggressive and misleading door-to-door sales tactics being used to sell hot water rental agreements in the Ontario markets is so profound that various community police services have issued public awareness statements, including:

 Toronto Police Service;
(http://www.torontopolice.on.ca/financialcrimes/enercare-know_your_rights.pdf)

 Halton Regional Police; (http://www.hrps.on.ca/PublicAffairs/Newsroom/Lists/MediaReleases/DispForm.aspx?ID=1941)

 Kingston Police Service; (http://www.police.kingston.on.ca/kpfrecentnewsarchivec17.php?command=viewArticle&ID=194&currentFeed=1)

 Ontario Provincial Police (Orillia);
(http://www.orilliapsb.ca/News%20Releases/Water%20Heater%20Scam%2016%20Nov%202009.pdf)

 Ottawa Police Service; and (https://www.google.ca/url?sa=t&rct=j&q=&esrc=s&source=web&cd=3&ved=0CE
wQFjAC&url=http%3A%2F%2Fwww.munsteronline.ca%2Fimages%2FO.P.S.Activity%2520Update%25202011%2520Article%2520Mar%252011%2520to%2520Mar%252017.doc&ei=CZTLUP-GGO2u2AX-noGgBw&usg=AFQjCNEITp9xNatSWK_Re2xpAaY5YO9ZaA&bvm=bv.1355325884,d.b2I)

 Ontario Provincial Police (Peel). (https://www.enercare.ca/sites/default/files/Beware%20of%20Knock%20on%20your%20Door.pdf)

A number of companies have undertaken consumer awareness campaigns in response to the problem to help educate consumers on their rights. These include: http://www.burnedatthedoor.com; http://www.hotwaterfacts.ca; http://www.ignorethedoor.ca

Reliance’s participation in the formal complaint is part of a continued commitment to take a leadership role in cleaning up the industry and eliminating the misleading sales practices used by some of its competitors to the detriment of Ontario’s consumers. Reliance is working with the Ontario Ministry of Consumer Services on proposed regulatory amendments that will address many of the tactics used to mislead consumers approached by door-to-door salespersons. On December 17th, Reliance commenced an action against National Energy Corporation (National Home Services) in the Ontario Superior Court alleging unfair practices and the use of misleading representations during the door-to-door sales process. Reliance believes these practices contravene the Consumer Protection Act and the Competition Act.

Reliance is a Canadian company with its head office in Toronto and employs approximately 1100 people across the country. Reliance offers two core product areas to its over 1.6 million residential and commercial customers: Heating, Ventilation, Air Conditioning (HVAC) and Security Services. Reliance Home Comfort provides retail sale, rental, service and maintenance of heating, ventilation and air conditioning equipment. Its water heater rental business, based largely in Ontario, is the largest in Canada. Reliance Protectron Security Services, the second largest security provider in Canada, provides security system sales, rental, installation, service, monitoring to homes and businesses across the country. Visit http://www.reliancehomecomfort.com to learn more.

Media Contact:
Linda Smith
416-457-1814

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