R.I. sues solar company for unfair, deceptive trade practices

Although Smart Green Solar, which is located on Broad Street in Providence, registered with the Secretary of State’s office in 2021, Gotra has been accused of deceptive trade practices in the past by federal agencies.

Gotra’s previous home security company, Alliance Security Inc., was fined $9.85 million in civil penalties by the Federal Trade Commission for illegal telemarketing and illegally obtaining consumer credit reports in 2020. “Alliance’s improper credit inquiries were so widespread, the complaint alleges, the company even tried to obtain credit reports of Presidents Trump and Obama,” a FTC news release at the time.

Gotra, who founded Alliance Security Inc. and served as its CEO, was required to pay $88,000 of that fine “based on his limited financial resources.”

Brian Hodge, a spokesman for Neronha, said the attorney general’s office did not contact the FTC during its investigation into Gotra.

In the new allegations, the attorney general alleges that “numerous” consumers said Smart Green salespeople misled them throughout the sales process and lied to them about their eligibility for the federal Residential Clean Energy Tax Credit and “other financial benefits” they could have been eligible for. The federal tax credit program provides eligible purchases with tax credits worth up to 30 percent of the purchase price of a solar panel system.

The complaint, which was obtained by the Globe, alleges that Smart Green’s management team trains their employees to guarantee customers will receive the tax credit, which they then described as an “I-owe-you” or “down payment” from the federal government. Neronha also alleged that Smart Green works with third-party lenders to “deceptively structure” financing arrangements with low initial payments. Then the loan payments allegedly dramatically increased by approximately 133 percent of the initial payment if the consumer failed to pay off 30 percent of the total loan amount within 18 months.

Consumers who are in communication with Neronha’s Consumer and Economic Justice Unit claimed they were told they were financing a solar panel system for “no money down at a locked-in rate” and were faced with paying potentially tens of thousands of dollars to the lender. Others had to pay a “much higher than expected price per month” for their energy, the complaint said.

One Rhode Islander, who was not named in the complaint but was described as a “legally blind consumer,” signed a contract with the company and paid for 33 solar panels. But once the system was installed, he learned that only 21 solar panels were actually placed on his roof. Smart Green did not notify him of the change or provide him with a refund until after Neronha’s office intervened and contacted the company on his behalf, according to court documents.

Neronha called Smart Green’s conduct “deeply concerning,” because Smart Green and its employees “deceived and took financial advantage” of Rhode Islanders who were looking to “do the right thing and ‘go green.’”

“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,” said Neronha. “Plainly, there is a leadership void that needs to be remedied, and with dispatch.”

“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,” added Neronha.

In a statement to the Globe on Wednesday night, Gotra said he was “surprised and dumbfounded” by Neronha’s allegations and accused the attorney general of needing “a story to attack the Governor.”

“Our company was merely a tool to achieve his ulterior motive,” said Gotra, who said the company is “processing how his office filed a lawsuit over a select few (four officially filed) mostly resolved customer complaints.”

Neronha spokesman Hodge said at least 12 Rhode Islanders have been in touch with the attorney general’s office with complaints about Smart Green Solar.

Smart Green’s tactics left customers “significantly less than they bargained for,” said 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.”

The entire initial transaction with Smart Green would take place over a company tablet where salespeople would fail to inform customers of their three-day right to cancel. Instead, salespeople would allegedly “rush through” the contracting process and direct customers to sign with their finger after they scrolled past the contract terms and disclosures, Neronha’s office said. Many customers did not receive a copy of their contracts immediately after signing. Others had difficulties obtaining a copy of their contract, which could take weeks and multiple requests, according to the suit.

Gotra’s 2020 agreement with the FTC permanently bans him from engaging in telemarketing practices of any kind. After Gotra signed the agreement, the FTC said in a news release that Gotra was a “repeat violator” of federal telemarketing laws. Gotra and Alliance previously settled similar allegations with the FTC in a 2014 court order, which both he and the company “never complied with,” according to a 2018 complaint filed by the FTC in a Massachusetts court.

Now at Smart Green, Gotra’s company regularly posts advertisements on its Facebook page and videos on its YouTube page. In some of the videos, Gotra or Chris Schiavone, the company’s chief sales officer, appear to be in a classroom setting with what could be members of their sales team.

In other videos, Gotra gives motivational speeches that discuss his more than $12,500 per month mortgage payments and his supposed six-pack abs.

The videos also allegedly demonstrate how Smart Green trains their sales team to interact with customers and address negative online reviews. Those who write negative reviews about Smart Green are “unreasonable people who you just can’t reason with” or are acting “emotionally,” Gotra said in a video.

“I could make a phone call today and buy 150 reviews if I wanted to be a 4.9 star that every other solar company boasts themselves to be,” Gotra said in a video, claiming no solar company could have such a high rating unless they’re “doing one deal a month.” “The only reason we don’t buy it [is] because integrity is one of our values. And to me, I want the customers to see a bad review.”

Gotra claimed that those who are turned off by negative reviews play “victim” and are “afraid of life.” They “always blame everybody else,” he said. Gotra also repeats misleading claims in the videos, such as claiming the company has a “five year history” of installing solar panels.

In his statement to the Globe Wednesday night, Gotra used Google ratings as a way to challenge Neronha’s case. The attorney general’s office “looked past the thousands of satisfied customers” Smart Green Solar has and “from whom we received over 350 five-star ratings,” said Gotra.

It’s unclear if Gotra has violated his agreement with the FTC while at Smart Green Solar. A FTC spokesman said the agency does not comment on whether individuals have violated court orders. He also said the FTC does not comment on actions by other law enforcement agencies.

This article has been updated with additional statements from Jasjit Gotra.

Alexa Gagosz can be reached at alexa.gagosz@globe.com. Follow her on Twitter @alexagagosz and on Instagram @AlexaGagosz.