A Dandenong South solar-panel company has been fined a thumping $3 million and its director $450,000 for “unconscionably” preying on thousands of home-owners.
Vic Solar Technologies and its director Sunny Srinivasan, 31, of Southbank, were prosecuted by Consumer Affairs Victoria over its misleading door-to-door sales methods.
The CAV director submitted for penalties of up to $750,000 and $75,000 fines for Vic Solar and Mr Srinivasan respectively.
On 3 May, Justice Michael O’Bryan, of the Federal Court, opted for more substantial punishment.
In 2014-‘18, Vic Solar signed up 4300 customers to rooftop solar systems. At least $21 million was gained from selling to home owners.
Customer witnesses had been charged up to $13,500 for systems – up to $6000 more than the average price for a system of similar size and quality.
“The consumer loss, across all of the sales made by Vic Solar, was … potentially in the millions of dollars,“ Justice O’Bryan said.
Vic Solar promoted a false ‘Community Bulk Buy’ scheme that was “at the heart of Vic Solar’s marketing efforts” to thousands of customers.
It targeted those who expressed interest with door-to-door sales that breached unsolicited agreement laws.
Sellers used false testimonals, misleading scripts and misled about the ‘One Solar’ solar panel’s country-of-origin and being part of a global manufacturer.
They failed to clearly advise home-owners about their rights to terminate the agreement.
In door-to-door sales, consumers were “more vulnerable to predatory and unfair sales tactics because they may not have undertaken any investigation of available market prices or alternative products,” Justice O’Bryan stated.
“Some consumers may also experience heightened sales pressure when a sales representative visits their home.
“In short, the conduct involved dishonest and unfair trading practices directed to consumers in vulnerable circumstances.”
Vic Solar, which went into administration in November 2019, was unlikely to be able to pay the fine, Judge O’Bryan stated.
But it was important for the court to “mark its disapproval” of the conduct and deter others.
Neither the company nor Mr Srinivasan showed evidence of contrition, he noted.
Mr Srinivasan – who is director of Grid Support Services and Eco Connect Solutions – was disqualified from managing a corporation for five years.
Consumer Action Law Centre chief executive Gerard Brody, in response to the court’s “very positive outcome”, said the State Government needed to ban unsolicited sales of rooftop solar panels.
This would accord with the Government’s committed ban on unsolicited sales of “traditional energy”.
“As Victoria transitions to a zero-carbon future, we need to promote trust in the solar industry and door-to-door sales and cold calls only serve to undermine this trust,” Mr Brody said.
“Crucially, any ban must cover the entire solar industry and not just the companies participating in the Government’s Solar Homes Program.
“Some of the worst cases of misconduct are occurring outside of this program.”
Vic Solar has been excluded from the Solar Homes Program.
The State Government currently has no plans to ban approaches for solar panel sales, a spokesperson said.
Consumer Affairs Minister Melissa Horne advised customers to “keep an eye out for aggressive sales techniques” and report unfair business practices to Consumer Affairs Victoria.
The “strong (court) outcome puts companies doing the wrong thing on notice that they’ll be held accountable”, she said.
“Helping Victorians to save on energy bills by going solar is a key priority for the Government, and consumers should be able to investigate installing panels without the risk of being misled or ripped off.”
