FOX 13 Investigates: How Vivint Smart Home used what a federal official calls 'identity theft' to boost sales (2024)

SALT LAKE CITY — Dionne Crump is a 55-year-old grandmother in Detroit who had never heard of Vivint Smart Home.

“In 2019, I found out there were 10 accounts opened in my name through a company called Vivint,” Crump said.

“I just happened to look on my credit report and see that it was listed,” she explained, “that I had 10 accounts opened on the same day that I did not open that totaled… I think it was $39,900 and something.”

Crump isn’t the only person who wound up with mysterious Vivint accounts. According to a federal lawsuit filed in Alabama, one of the plaintiffs found seven unauthorized accounts registered to homes in Texas. At one point, she was told she owed nearly $15,000.

Vivint is one of the biggest technology firms in Utah. Its name is on the Utah Jazz’s arena. But the federal government says it was unlawfully using people’s credit and identities to open accounts.

In January, the U.S. Department of Justice announced a $3.2 million settlement with the company. Three months later, the Federal Trade Commission announced a $20 million settlement.

The FTC also explained how the unauthorized accounts were created.

One method is called white paging. It takes its name from the residential listings in phone books.

If a potential customer didn’t have good enough credit to finance a Vivint Smart Home system, the FTC explained, the salesperson would find a person with a similar name and use his or her credit instead. If a John Smith, for example, had bad credit, the salesperson would find a John Smith with good credit and apply it to the first Smith’s application.

In other instances, according to the FTC, the Vivint salesperson would ask the potential customer for the name of a relative or acquaintance with good credit. The salesperson would add him or her as a co-signer without the person’s permission.

Sometimes, the salesperson added a co-signer that even the customer didn’t know about.

When the customers defaulted, the FTC says, innocent third parties had their credit scores lowered and were pursued by debt collectors.

“This behavior that's not consistent with some integrity and doing right by consumers has no part of this company,” said Todd Pedersen, the then-CEO of Vivint, on May 14 during a quarterly earnings call.

“But back in 2017,” Pedersen added, “we did have some salespeople that got around some systems that we found out and let those people go.”

But the FTC complaint says that while Vivint in 2017 terminated hundreds of sales staff, it later hired some of them back.

FTC Commissioner Rohit Chopra, in a written statement, said the white paging was identity theft.

“It appears that that management turned a blind eye to the scam,” Chopra wrote, “because the company could pump up its sales figures in ways that would help score a higher valuation when going public.”

Vivint entered the New York Stock Exchange in January 2020.

As for the pending lawsuit in Alabama, Vivint has said in court filings that it was defrauded by its own staff’s sales practices.

A Vivint spokeswoman declined FOX 13’s request for on-camera interviews and did not answer a question about who used Crump’s ID or collected commissions on the accounts in her name. Crump reported the use of her ID to police and could forward a name to detectives.

The company did provide a written statement reading in part:

“We had already taken steps before the FTC began its review to strengthen our compliance policies, and will continue to make this a focus going forward.”

FOX 13 tried to participate in Vivint’s quarterly earnings call earlier this month. No one called on us to pose a question.

But new Vivint CEO David Bywater did say the company is taking steps to ensure good sales practices.

“So, if anyone ever has any questions on that,” Bywater said, “talk to me personally.”

After about two years of back-and-forth with Vivint, bill collectors and credit rating agencies, Crump says her case was resolved last month. The 10 accounts in her name and the debts were canceled. Her credit score was restored.

Now, Crump would like to be compensated for her trouble and the extra interest she had to pay on other lines of credit while the Vivint debts were on her record.

“They see all these listings of account for almost $40,000,” Crump said. “Didn’t nobody want to give me no credit.”

What would she say to Vivint?

“I think that it’s sad that you use people’s identity to gain profit.”

As part of its settlement with the FTC, Vivint has placed a link in the bottom right corner of its homepage where someone can make a report if they think a Vivint account was opened without their consent.

Copyright 2021 Scripps Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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FOX 13 Investigates: How Vivint Smart Home used what a federal official calls 'identity theft' to boost sales (2024)

FAQs

What is the Vivint controversy? ›

What was the settlement about? The FTC alleged that Vivint helped unqualified customers get financing for home security products by misusing other people's credit reports. As a result, people who had never interacted with the company found Vivint accounts on their credit reports.

What is the class action lawsuit against Vivint? ›

Home security company Vivint agreed to a $9.75 million class action lawsuit settlement to resolve claims that it violated the Fair Credit Reporting Act (FCRA) by accessing consumer credit information and using that data to create false accounts.

Does Vivint need your social security number? ›

This information may include your name, mailing address, physical address, phone number, email address, social security number, credit score, and information about your purchase or quote, including information about your home or property.

Is Vivint security legit? ›

Bottom Line. Vivint is one of the strongest smart home security systems. From its smart touchscreen control panel called the Vivint Smart Hub to its AI-powered security cameras, Vivint delivers a unique smart home security experience that no other security system on the market can match.

Did Vivint go out of business? ›

On March 10, NRG acquired Vivint Smart Home. Together, we will help you power, protect, and intelligently manage your home – your way. Our combined expertise means we are fully equipped to deliver what you need to keep your home safe, secure, and always on so you can focus on the most important things in your life.

Which company owns Vivint? ›

How do I file a complaint against Vivint? ›

Customer Complaint:

If you have a complaint with the company or would like to have a technician sent out to your home, you are encouraged to contact Nathan Wilcox at legal@vivint.com prior to filing a BBB complaint. Please understand that you may file a complaint with the BBB now or at any time during this process.

Who gets the most out of a class action lawsuit? ›

Contrary to popular belief, class action settlements are not divided among class members evenly. Lead plaintiffs receive the most money in class action lawsuits. They typically have the worst injuries and the highest damages.

Is ADT better than Vivint? ›

ADT is better than Vivint slightly, although they are both top systems. However, Vivint gives users the option to self-monitor only, which ADT does not. Vivint also works with better IoT devices, like Nest thermostats and Philips Hue lightbulbs as opposed to Kwikset smart locks and Liftmaster devices like Vivint.

Do you own your equipment from Vivint? ›

Do I own Vivint equipment once it's paid off? Yes, this equipment is yours once you pay for it in full. If you use the financing option to pay over time, you typically pay off the equipment within three to five years.

Is Vivint encrypted? ›

The Vivint Smart Hub is LTE cellular-connected and also uses encrypted Wi-Fi to connect your entire system and give you complete control.

Why was Vivint fined $20 million? ›

The FTC claimed that Vivint violated the Fair Credit Reporting Act (FCRA) by improperly obtaining credit reports to qualify potential customers for financing and also violated the FTC's Red Flags Rule by failing to implement an identity theft prevention program.

Is there a lawsuit against Vivint? ›

Vivint hasn't admitted any wrongdoing but agreed to a $9.75 million settlement to resolve the FCRA class action lawsuit settlement. Under the terms of the settlement, class members can receive a $1,200 payment for each account created with their stolen credit information that was subject to collection efforts.

Can Vivint see my camera? ›

Your camera feed is private and not monitored or accessible by Vivint. To learn how to access this video feed, follow these steps: From the home screen of the Vivint Smart Home app, tap the Cameras icon from the middle of the bottom navigation bar. To view a live feed, tap the thumbnail of the desired camera.

Who is the number one smart home security company? ›

ADT Vivint

What is the ADT v Vivint lawsuit? ›

After a judge made key rulings for an impending trial, Vivint quietly settled ADT's lawsuit accusing it of stealing customers through deceptive sales practices, a practice that earlier this year resulted in a $190 million judgment against Vivint to CPI.

What is the Vivint lawsuit in NC? ›

Vivint was hit with a separate $189.7 million verdict in North Carolina federal court in February over allegations that it tricked customers of rival CPI Security into switching providers by having sales representatives claim that Vivint had acquired CPI.

What was the jury verdict on the Vivint case? ›

A federal jury in North Carolina on Friday delivered a $189.7 million verdict against Vivint Smart Home, concluding with CPI Security Systems on claims that the Provo, Utah-based company duped homeowners into switching security providers.

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