Lloyd Schell, 59, of Maple Ridge, B.C., is due in Vegreville provincial court on July 8, charged with conducting direct sales without a licence and failing to give a refund as required by law.
Schell’s latest venture is Vin Water Systems, registered in Hinton, Alta., but most recently operating out of Maple Ridge.
Go Public has spoken to several people, many of them seniors, who bought reverse osmosis water filter systems from Schell.
Many of them say that after buying the system, they discovered they had paid many times more than a comparable system would cost, and that Schell was unreachable when they needed parts or servicing.
Service Alberta charged Schell after a complaint from Antje and Eberhard Bettac of Hilliard, Alta.
The Bettacs are in their 80s. They say Schell came to their home and offered to test their water for free.
“It really showed there was stuff in our water that maybe shouldn’t be in there,” said Antje.
Schell’s “test”, as described by the Bettacs and others, is known as the “Precipitator” or “Jam Jar Test”, a well-known hoax.
An electrical current is passed between two metal posts immersed in a glass of water. The electricity reacts with natural minerals and salts present in almost all safe tap water, turning the water brown and gooey.
The “test” proves nothing about the safety of the water but gives the illusion of contamination, says Lucio Gelmini, professor of chemistry at MacEwan University.
“It’s effective, but not valid,” he said.
The Bettacs paid $1,500 to Schell for an under-sink water filter system. But the filters quickly plugged and the system failed.
“And when we tried to get the filters, [Schell] had fled the coop already,” Bettac said.
Schell didn’t return their money when they requested.,
Seller has a long history of violations in B.C.
Complaints against Schell date back to at least 1993.
Back then he was selling vacuum cleaners, and was cited for taking advantage of vulnerable seniors, using high-pressure sales tactics, refusing to give refunds when required by law, and overstating the value of his vacuum cleaners to give the illusion of a discount.
In 2002, after a lengthy investigation by the B.C. government, Schell signed a promise to clean up his act.
He declared bankruptcy in January, 2005.
Then in December, 2005, the B.C. government banned him from direct selling for 5 years after still more complaints from seniors.
Some of the elderly people said they let Schell or his staff into their homes after being told they had won a prize, then had to endure hours of high-pressure sales tactics.
In 2010, the B.C. government took the unusual step of issuing a warning that Schell’s ban was about to expire.
“We were very seriously concerned about the repeated nature of the violations,” said Manjit Bains, Vice President Corporate Relations, with Consumer Protection BC.
Bains calls Schell’s behaviour “egregious”.
“They were using deceptive and unconscionable kinds of sales tactics…and [putting] undue pressure on vulnerable seniors.”
Banned in B.C., moved to Alberta
In 2010, while Schell was still banned in British Columbia, he set up Vin Water Systems, just across the border in Hinton.
He toured small Alberta towns and hamlets, making cold calls in such places as Wabamun, Half Moon Lake, New Norway, Vermilion and Westlock.
Many of the doors he knocked on belonged to people living on lakeshores, who relied on well-water, or who lived in counties known for having groundwater with high mineral content.
Within months RCMP detachments began getting complaints about Schell from people who say they bought water filter systems that had stopped working.
Schell promised a lifetime warranty and, to some people, a lifetime supply of filters. However, when buyers tried to contact Schell for follow-up service, they say he didn’t return calls.
Len Chapman of Wabamun, Alta, paid Schell almost $2,300 for a system after Schell showed him the Precipitator Test.
The system worked fine for a few months but became unusable after the filters clogged. He then spent months trying to reach Schell.
While searching for filters online, he found comparable systems available for under $200.
Even still, he says he would have been satisfied had Schell kept his promise of lifetime service.
“I paid for something,” he said. “I never got the service. That’s what makes me angry.”
Salesman denies wrongdoing, claims plea bargain in the works
When reached by CBC, Schell said he simply didn’t know he needed a licence to sell in Alberta and that he’s negotiating a settlement.
He also denies he was ever difficult to reach.
“That’s bullshit,” he said. “You found me didn’t you? I’m in the phone book. Sometimes we miss a person or two. But once we know about it, the filters go out to the customer.”
Schell accused CBC News of “digging up garbage” about him.
“You go after a 60-year-old man who just tries to do a proper living … and all these guys out there who are screwing people left, right and centre, why don’t you go get a story about the vacuum guys who are screwing all the people.”
Schell blames his problems in B.C. on the people he hired.
“I was in the vacuum business for 30 years,” he said. “And out of 30 years there was one year that went bad."
Charges and bans don’t stop repeat offenders
Mike Berezowski, a spokesman for Service Alberta, says it’s not uncommon to see repeat offenders in the direct sales industry.
“Unfortunately, this is how some people operate,” he said. “They will never operate within the law.”
Berezowski says the best protection is to check out any door-to-door seller before you buy.
“You should always be wary when somebody comes to your door,” he said.
“Take the time you want to do some comparison-shopping, check out the history of the company.”
He advises people to check with Service Alberta to see if the company is licenced. If it is, consumers can cancel the contract for any reason within ten days. The contract can be cancelled within a year if the seller isn’t licenced.
Schell is now back in B.C., where the government there is investigating new complaints from seniors.
One of those is 71-year-old Ruth McClounie of Quesnel, B.C.
“I feel like I had to give up almost $3,000 to a crook,” she told Go Public.