Attorney General Neronha files lawsuit against solar company Smart Green for deceptive practices

Published on Wednesday, June 21, 2023

Attorney General Peter F. Neronha today announced the filing of a lawsuit against Smart Green Solar, LLC (Smart Green) and its CEO Jasjit Gotra for violating the Rhode Island Deceptive Trade Practice Act (DTPA) and engaging in a pattern of unfair and deceptive trade practices targeting Rhode Island consumers of residential solar panels.

As alleged in the complaint, Smart Green engaged in a pattern of deceptive and unfair trade practices as they went door-to-door, making unsolicited sales pitches for residential solar panel systems in Rhode Island. The Attorney General is seeking a court order requiring Smart Green to stop misleading customers, provide paper contracts to customers immediately, and pay restitution to injured customers.

“The conduct alleged in the Complaint is deeply concerning. As alleged, the defendants deceived and took financial advantage of Rhode Islanders who were looking to do the right thing and ‘go green,’ leaving them with significantly less than they bargained for,” said Attorney General Peter Neronha. “This type of behavior disincentivizes and fosters distrust among those who wish to do their part to mitigate climate change, potentially setting us further behind Rhode Island’s climate goals. I am also greatly concerned about the largely unregulated solar sales industry, as well as the state’s overall lack of strategic thinking regarding implementation of clean energy programs. Plainly, there is a leadership void that needs to be remedied, and with dispatch. In any event, and in the meantime, this Office will continue to use the much strengthened consumer protection law we fought for to protect Rhode Island consumers and go after businesses that don’t play by the rules.”

Consumers interested in learning more about safely purchasing residential solar panels for their home, should visit the dedicated webpage on the Attorney General’s website.

Deceptive Sales Tactics

As alleged in the complaint, numerous Rhode Island consumers confirmed to the Attorney General’s office that they believed Smart Green salespeople misled them throughout the sales process, particularly regarding their eligibility for the federal Residential Clean Energy Tax Credit, and other financial benefits they could expect to receive. The Residential Clean Energy Tax Credit program provides eligible purchases with tax credits worth up to 30% of the purchase price of their solar panel system. It is alleged that Smart Green management trains their employees to essentially guarantee that consumers will receive this tax credit, describing the credit as an “I-owe-you” or “down payment” from the federal government.

Smart Green also works with third-party lenders to deceptively structure financing arrangements with low initial payments. These loan payments then dramatically increase by approximately 133% of the initial payment amount if the consumer fails to pay off 30% of the total loan amount within 18 months. Consumers who were told they were financing a solar panel system for no money down at a locked-in rate are now faced with either paying potentially tens of thousands of dollars to their lender or paying a much higher than expected price per month for their energy.

According to the complaint, Smart Green was also allegedly taking advantage of consumers, including in one instance, a visually impaired consumer. In that instance, the customer was convinced to purchase and was in fact charged for a system with 33 panels. Once the system was installed, he learned that in fact only 21 panels placed on his roof. Smart Green did not notify the customer of this issue months after the panels were installed, and not until the Office of the Attorney General intervened.

Finally, consumers reported that their entire initial transaction with Smart Green took place on an electronic device which allowed salespeople to rush through the contracting process, fail to inform consumers of their statutory three-day right to cancel, and direct them to sign with their finger after they scrolled past the contract terms and disclosures. Consumers also reported they did not receive a copy of their contract immediately after signing and instead had difficulty obtaining a copy, which often took weeks and multiple requests.

Smart Green Solar has been registered with the Secretary of State since 2021. In March 2020, Smart Green CEO Jasjit Gotra and a previous company, Alliance Security, Inc., were each fined $9.85 million in civil penalties by the Federal Trade Commission for illegal telemarking and illegally obtaining consumer credit reports.

Deceptive Trade Practices Act

In 2021, Attorney General Neronha worked with the General Assembly to pass legislation that restored the authority of the Office of the Attorney General to protect Rhode Island consumers against violations of the DTPA. Other efforts led by the Attorney General under the newly-strengthened DTPA include lawsuits against auto dealers for allegedly unfair pricing practices and a suit against a contractor for allegedly unlawful behavior, halting a Certificate of Good Standing scheme, as well as other investigations.

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