Attorney General's News Release

September 17, 2002

Kansas water-treatment business to pay $69,000 for misrepresentations, high pressure tactics

Jefferson City, Mo. — Attorney General Jay Nixon announced today that his office has obtained a permanent injunction requiring an Olathe, Kan., business to pay $69,595 in restitution and penalties for violating Missouri's consumer fraud laws by using high-pressure sales tactics and misrepresentations to sell its water treatment systems.

The judgment, signed last week by Buchanan County Circuit Judge Randall R. Jackson, resolves a lawsuit filed by Nixon in August 2001. The order requires Hague Quality Water of Kansas City Inc. to refund $61,095 to consumers for using fake contests to solicit potential customers, making misrepresentations during sales presentations, and neglecting to inform customers about finance charges.

Besides the refunds, Hague must, at its own expense, remove the water treatment systems or provide free service, products or replacement water systems where appropriate. The company is also permanently prohibited from engaging in any act of deception, fraud or misrepresentation detailed in the court order. Hague faces civil penalties of up to $5,000 if it violates the court order.

Nixon said Hague Quality Water obtained potential customer names by placing entry boxes advertising a contest to win a jet ski or a car in various public places. Hague did not disclose on the entry form or box that entrants would be contacted to set up a sales presentation in their homes.

When potential customers were contacted, they were promised free vacations to Branson, which never materialized. Once Hague employees were inside the homes for the sales presentations, Nixon said, the deceptions continued with a "test" of the customers' tap water.

According to Nixon, potential customers were told their tap water was hard and contained hazardous chemicals and substances. Consumers were assured that a water treatment system from Hague would alleviate the hardness and remove the harmful chemicals, and that the system would pay for itself in only a few years because of the savings in soap, detergent and energy.

Nixon said customers who purchased a water treatment system were told that if they made a certain monthly payment, the system would be paid for in four or five years. What Hague employees did not tell those customers was that if they paid only that monthly payment, substantial finance charges would accrue each month, causing the total amount paid for the system to be thousands of dollars more than the total purchase price represented by Hague.

Inquiries from consumers should be directed to consumer@ago.mo.gov or 1-800-392-8222 (from within Missouri) or 573-751-3321 (outside Missouri).

All media inquiries should be directed to Press Secretary John Fougere.

E-mail      Phone: 573-751-8844         Fax: 573-751-5818