These Nova Scotians say they felt tricked into paying thousands for water systems

For Natalie Lent, every day in her home feels like a boil water advisory since she only uses bottled water, even for cooking. 

But there has been no official warning. In fact, the Nova Scotia woman has three new filtration systems for her well water, valued at nearly $12,000, collecting dust.

"It's really just an ornament at this point for me," Lent said, pointing to her water softener system.

She bought them last July from Atlantic Environmental Systems, a water filtration company based in Dartmouth, N.S., that is now under scrutiny. At the time, Lent had just moved into her rural home along the Minas Basin and called the company to inquire about their products. 

"There was a sulphur smell, the water was quite hard. So that was one of the priorities on the list of things that I had to do was to put in a water system because water is a necessity," she said.

After a salesperson came to her home to pitch products, she agreed to the sale. The 53-year-old changed her mind a few days later when the installers arrived and did not answer her questions, such as what to do if she were to lose power.

"When I asked them to stop, all of a sudden there's more people in my basement helping them speed up the process to put this in," Lent said.

"Since then it's been a nightmare."

She is not alone with her concerns about Atlantic Environmental Systems. CBC News has learned the provincial government is examining whether the company has violated the Direct Sellers Regulation Act. It has given the company an opportunity to respond before deciding in the coming weeks if Atlantic Environmental's seller's permit should be cancelled or suspended.

It comes after receiving a series of complaints from homeowners across Nova Scotia, and follows a P.E.I. decision last August that revoked the company's licence. Atlantic Environmental appealed that decision and lost in April. 

"The evidence in this appeal clearly shows that the appellant and its salespeople repeatedly engaged in exploitative and high-pressure sales tactics while direct selling to P.E.I. residents," said Bloyce Thompson, P.E.I.'s justice minister, in his written decision.

In Nova Scotia, the Better Business Bureau (BBB) issued an alert for a similar pattern of complaints alleging the company "targets senior citizens and does not clearly or transparently notify customers about its policies." The BBB also cited concerns that Atlantic Environmental allegedly conducts poor after-sales service "with the intention to surpass the cancellation window date."

'Manipulative' presentation

CBC News has interviewed several former Atlantic Environmental Systems salespeople, who all expressed unease about an "aggressive" sales culture. In particular, they described the in-home sales presentation as "manipulative," saying it uses "fear-mongering" to frighten homeowners into believing they have to "invest in their health" on the spot.

The recent P.E.I. appeal decision cited 10 complaints. Thompson said in his report that some residents felt "threatened and scared by the salespeople."

"Many of these residents were seniors, and some were suffering from debilitating diseases, including cancer, Alzheimer's and dementia. Their age, coupled with the fact that these salespeople were present in their home — often at night and for several hours — made them particularly vulnerable," said Thompson in his decision. 

Owner Danny Goldman disputes any wrongdoing by the company he founded five years ago. He told CBC News that Atlantic Environmental Systems is ethical and "does not target certain age demographics."

"Ninety-nine per cent of our customers are happy. You can't make everyone happy. It's just part of being in business," said Goldman. 

Corrine Pothier of Wedgeport, N.S., considers herself one of the unhappy customers. In February, the 81-year-old received a phone call saying she had recently completed a survey and won a first aid kit.

But in order to claim the prize, she had to agree to a water test in her home.

"I thought it was probably the Department of Health [that] wanted to check the water," said Pothier. "[The agent] came and she started demonstrating all of this and it sounded great."

Four hours later, Pothier was "mesmerized" by the presentation and agreed to nearly $8,000 worth of equipment from Atlantic Environmental Systems. She did not get the promised first aid kit. 

The installers arrived two days later, but never finished the job. Her daughter, Michele Pothier, stopped everything when she learned about the 12.99 per cent interest rate and 15-year finance agreement.

"I'm like, what? You're going to end up paying like 15 grand for this stuff by the time it's all said and done. And not even that, you're 81-years-old … what the heck?" said Pothier.

Then she read the terms of the contract and realized her mother consented to having Toronto-based financial company, Financeit, register a lien on her parent's property.

"If they do pass, then the estate has to pay for that. The money comes out of the estate," said Pothier. "That is unacceptable."

Financeit did not respond to a request for comment from CBC News.

Goldman said in an interview he recently made changes for clients over the age of 70. The financing agreement will now be limited to a 10-year agreement. Clients over the age of 72 will also require a co-signer under the age of 65.

Pothier turned to social media to alert the community about her mother's experience, only to learn her friend's parents also got hooked.

Michele Tabb said her parents, in their late 70s, were also impressed with the sales presentation by Atlantic Environmental Systems. 

"Yeah, it worked on them," she said. "And now they feel kind of embarrassed about it, and you know, it makes you feel sad."

CBC News obtained a copy of the script used by sales agents, which features 10 different presentations. The goal is to show hardness and taste comparisons between tap water and the company's purified water, then detail how their water system "removes chlorine and all the heavy metals like lead, mercury, copper and arsenic."

The precipitation test is one of the first demos laid out in the script — one the sales agents are to return to throughout their time in the home as they describe the results as a "mess." The test shows a chemical reaction that makes any mineral in people's tap water appear cloudy even if it's not a health concern, according to two water experts who spoke with CBC. 

Former employees said they were expected to complete the entire presentation and stay in the home for a minimum of two hours, all while nodding and smiling with enthusiasm. 

Goldman said he encourages his employees to follow the script because it follows a "strict code of ethics" by the Canadian Water Quality Association.

However, the association voted "unanimously and immediately" to revoke the company's membership following the P.E.I. appeal decision. President Shelley Peters told CBC News that the association does not endorse the precipitation test.

Ron Hofmann, a professor at the University of Toronto who specializes in water quality, said homeowners should be cautious when anyone wants to test their water quality with the clear intent to sell a device.

"I would be very skeptical because while there are certainly legitimate tests that you can do in a person's home to measure certain things, it's also very easy with a bit of knowledge of chemistry to fix a test to make the water do all sorts of different things and make it appear that the water is very bad when, in fact, it isn't," said Hofmann.

In the case of Atlantic Environmental Systems, it's not always immediately clear they're even selling a product. Last fall, the company distributed a mass mailout of bingo scratch tickets in several communities outside of Halifax. The tickets included flashy prizes such as a motorcycle, television and laptop — with the condition that a "home care product presentation" must be booked.

Aline Thibodeau of Herring Cove said she immediately assumed it was fraudulent. An avid bingo player, she recognized that B91 and I79 are not legitimate bingo numbers.

"I called the local police, spoke to an officer and he called them, and when he came back on the line, he said he can't say that it's illegal but it's highly suspicious and please do not call them," said Thibodeau.

Goldman told CBC News his company has different methods of obtaining leads, which he doesn't plan to stop.

History of concern

Goldman, also known as Danny Shamon, operated a water company in Ontario called Eagle Water. In June 2017, he pleaded guilty to committing an "unfair practice contrary to the Consumer Protection Act." He was placed on probation for two years, fined $4,000, and ordered to pay a $1,000 victim fine surcharge. He also had to pay approximately $11,000 in restitution to three consumers, some of whom were seniors.

"I took accountability for my actions. I made sure those customers got a refund, made sure they got all their money back. I paid the restitution and moved forward. I paid my dues," he said.

"I had to learn as a business owner, and that's why I made changes to the way I do business."

For Natalie Lent, it's likely too late. Her deferred payments are set to begin this month on three systems she said "don't work," a claim Goldman refutes.

The company has been back to her home to test the water and adjust the levels on two different occasions. Lent said her water continues to leave a white residue on her dishes, hardware and countertops. She cannot afford to pay for another system.

"It's like a bad dream that I wish I could wake up from because it's affected me on so many levels," she said. "I do need to have something in place because I do have hard water. It makes me nervous. Who do I trust now to put a system in?"

On the day of her installation, Lent said she called the main office four times after asking the installers to stop their work. She said she also called at least once more within the 10-day cancellation window and spoke with the operations manager. She didn't realize the contract said she had to put her request in writing.

Goldman said the contract makes it clear how to cancel, and he denied that his installers would refuse to stop or leave when asked. He said he won't give Lent a refund.

"Should she grant us permission to return to her home, we are happy to go above and beyond to provide exceptional customer service. This is our unwavering commitment to her and her family," Goldman told CBC News in a text message.

Kelly Wyer, registrar for the Nova Scotia Direct Sellers Regulation Act, said her advice to consumers is to take time to research a product before deciding to buy it.

"We understand it's difficult when there's somebody at the door that has an aggressive sales pitch or some type of sales pitch that makes it appealing to the people at the door to the consumers," she said.

"Read the fine print. Just don't make decisions right away, and they need to take the opportunity to ask people to leave at any point that they're not comfortable."