ADT to Pay Over $1.3 Million After DOJ Finds It Illegally Charged Servicemembers
The U.S. Department of Justice announced on April 14, 2026, that ADT LLC (doing business as ADT Security Services, the nation’s largest home security services company) has agreed to pay more than $1.3 million to resolve allegations that it violated the Servicemembers Civil Relief Act (SCRA) by unlawfully charging thousands of military members who tried to cancel their home security contracts after receiving relocation orders.
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What ADT Did Wrong
When a servicemember receives military orders to relocate, federal law gives them the right to terminate certain consumer contracts (including home security agreements) effective at the end of the billing period in which they give notice. No additional charges, no early termination fees, and no waiting beyond that billing cycle.
ADT’s policy didn’t follow that rule. According to the DOJ, ADT imposed a 30-day notice requirement on servicemembers canceling their contracts. In practice, that meant a servicemember’s contract wouldn’t end until at least 30 days after they submitted their termination request, regardless of their orders or move date. The company continued billing beyond the current billing period, which the DOJ alleges is a direct violation of 50 U.S.C. § 3956, the SCRA’s contract termination provision.
At least 3,400 servicemembers were affected.
ADT denied the allegations and admitted no liability as part of the settlement.
What the Settlement Requires
Under the four-year settlement agreement, ADT must:
- Deposit $1,260,000 into an escrow account to compensate affected servicemembers. Each qualifying servicemember will receive a refund equal to the unlawful charges they were billed, plus indirect damages calculated as the greater of $300 or three times the value of those unlawful charges.
- Pay a $79,380 civil penalty, which is the maximum penalty allowed for a first-time SCRA violation.
- Develop new SCRA termination policies and procedures, subject to DOJ approval.
- Provide SCRA compliance training to all covered employees.
- Report to the DOJ semi-annually on any complaints related to SCRA compliance in the context of contract terminations or default judgments.
- Cooperate with DOJ compliance reviews throughout the four-year term of the agreement.
The settlement only releases claims under 50 U.S.C. § 3956. Other potential federal claims against ADT remain unaffected.
What the Law Actually Says
The SCRA’s contract termination provision, codified at 50 U.S.C. § 3956, allows servicemembers to terminate a covered consumer contract at any time after receiving qualifying military orders. Covered contracts include cell phone plans, internet service, cable or satellite TV, gym memberships, and home security contracts. Those orders include a permanent change of station (PCS) to a location where the service isn’t available, or a deployment of 90 days or more to a location that doesn’t support the contract.
When a servicemember exercises this right, the contract ends at the close of the billing period in which notice is given. The company cannot charge early termination fees and must refund any prepaid amounts covering service periods after the termination date, within 60 days. A 30-day waiting period on top of that is not permitted.
As U.S. Attorney Jason A. Reding Quiñones for the Southern District of Florida put it in the DOJ’s announcement: “The law is clear. When servicemembers receive relocation orders, they have the right to terminate contracts without penalty beyond the current billing period.”
A Pattern the DOJ Is Actively Pursuing
This settlement is part of a broader, sustained enforcement effort. Since 2011, the DOJ’s Civil Rights Division has obtained over $488 million in monetary relief for more than 152,000 servicemembers through SCRA enforcement actions.
The Civil Rights Division’s Housing and Civil Enforcement Section, working alongside U.S. Attorneys’ Offices across the country, investigates these violations and pursues settlements and litigation where warranted.
What Servicemembers Should Do
If you believe a company has violated your SCRA contract termination rights, whether related to a home security contract, phone plan, gym membership, or any other covered agreement, you have options.
Contact the nearest Armed Forces Legal Assistance Program Office. Locations can be found at legalassistance.law.af.mil. You can also find additional information about DOJ’s SCRA enforcement work at www.servicemembers.gov.
Keep copies of your military orders and any correspondence with service providers. If a company imposes fees or refuses to terminate your contract in line with your SCRA rights, document everything and report it through your legal assistance office.
