in this commentary
- ADT buys your security company, hikes your rates, and locks you into a surprise 5-year deal.
- Want to cancel? ADT demands a $527 fee for a contract you never signed.
- Is this merger maneuver legal, and can you fight back against these hidden contract traps?
When Robertann Usher’s home security company merges with ADT, he discovers he has a five-year contract with a higher price. Getting out will cost him $527. Is that legal?
Question
I have a problem with my ADT bill and was hoping you could help me. Here’s the situation: I had a home security system through Ackerman Security, which recently merged with ADT. I recently received my first bill with ADT and decided to discontinue my service.
I paid $63 quarterly for security service with Ackerman Security. ADT’s prices are higher.
When I called ADT, a representative told me I was under a five-year contract with ADT and that I could not cancel.
This is a mistake. My agreement is with Ackerman Security. I appealed to a supervisor who said that in order to end the contract, I would have to pay a $527 cancellation fee. The representative placed me on hold and promised me a call back in 48 hours. I have not heard anything back in weeks.
I don’t want ADT to charge a $527 cancellation fee for a contract I know nothing about. Can you help me? — Robertann Usher, Snellville, Ga.
Your voice matters
When one company buys another, contracts often change, sometimes bringing higher prices or surprise fees. ADT tried to lock this customer into a new, pricier contract with a hefty cancellation fee after acquiring their original provider. We want to hear your thoughts.
- Have you ever experienced unexpected contract changes or price hikes after a company merger or acquisition?
- Should a company be allowed to automatically transfer you to a new, longer, or more expensive contract without your explicit consent?
- What’s the best way to fight back against unfair contract changes or cancellation fees?
Answer
You’re right. Your agreement was with Ackerman Security. Even though ADT acquired Ackerman, that does not give it the right to start charging you more and impose a $527 cancellation fee.
Or does it? Contracts like these can be filled with consumer-unfriendly clauses that allow the company to raise rates without notification and impose cancellation fees. I’m sure the ADT lawyers reviewed the Ackerman contracts before they signed off on the acquisition. So maybe they shouldn’t have raised your rates, but they probably could. (Related: My husband died. Can I get out of this ADT contract?)
Still, this doesn’t look right — and it isn’t right. A business must notify its customers before raising its rates, and it should give them a way to opt out of its services if the cost is too high. A $527 cancellation fee seems outrageous.
I publish the names, numbers and email addresses of the ADT customer service executives on this site. A brief, polite email to one of them might have helped.
At a bare minimum, a service company owes its customers fair warning and a chance to cancel their contracts before being automatically switched to a new provider. And there should be no automatic rate hikes. If I sign a contract to pay $100 per month to Company A for their services, then Company B damn well better get my knowledgeable written permission without tricks or fine printese before taking over my contract, let alone charging me for any amount over $100 per month for the same service.
Read more insightful reader feedback. See all comments.
Your case is a cautionary tale for anyone who is interested in a home security system. These can certainly be worth it if you live in a high-crime neighborhood or need a sense of security, but the contracts can be tricky. You need to read them from front to back before signing, and be sure to monitor your monthly bill for price increases. If you don’t, the systems can quickly become unaffordable, as they did for you. (Here’s how to fix your own consumer problems.)
You might want to check out this site, too. We’ve had a few ADT cases in the past.
I contacted ADT on your behalf, and it agreed to cancel your account without penalty.
Don’t get trapped
Your guide to fighting unfair contract changes & fees
Before you sign: know the terms
After signing: stay vigilant
If things go wrong: fight back
Executive Contacts
Feeling insecure about ADT’s customer service? Don’t sound the alarm just yet. Escalate your issue to these executives for a resolution.
Primary Contact
Harriet B. Naismith
Executive Resolutions Team Escalations Specialist
Secondary Contact
Jamie Haenggi
Executive Vice President, Chief Sales and Marketing Officer
What you’re saying
Readers are fed up with automatic contract renewals, hidden fees, and the predatory practices of merged companies. The top comment from JenniferFinger demands clear, written permission before any changes, while others share stories of fighting back against systems designed to wear them down.
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Contracts require ‘knowledgeable written permission’
Top commenter JenniferFinger argues that a company must get ‘knowledgeable written permission’ before switching providers or raising rates. Gerri Hether agrees, noting that mergers often mean ‘fine print the acquiring conpany forgets to send’ consumers.
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A ‘business model built on customer fatigue’
Blues Traveler calls it trapping customers in ‘predatory contracts’ to fund bonuses. Sandra says companies ‘bank on inertia,’ knowing most people won’t read the terms. Tina agrees, calling it a ‘business model built on customer fatigue.’
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Targeting the vulnerable vs. personal responsibility
Mel65 hates contracts that ‘target the elderly and vulnerable,’ citing predatory examples. Conversely, 737MAXPilot argues people sign ‘legally binding agreements’ and then ‘cry foul.’ Mr. Smith fires back that consolidation ‘removes all consumer choice.’
