Seven Brooklyn, New York,-based consumer electronic e-tailers were forced to pay $665,000 to consumers they recently cheated and another $100,000 in investigation costs as part of a settlement reached with the NY State Attorney General.
“These companies engaged in the worst kinds of consumer fraud, from classic bait-and-switch schemes to blatant lies and bullying sales tactics,” said Attorney General Andrew Cuomo.
Under the terms of today’s settlements, the seven companies will pay a total of $665,000 in restitution and civil penalties, and over $100,000 to cover the costs of the Attorney General’s investigation. Two of the companies will close completely. The remaining five companies have agreed to substantially change their business practices and will be subject to ongoing monitoring by the Attorney General’s Office.
“Today’s agreements will protect consumers nationwide from these types of predatory online merchants, as well as deliver much-needed restitution to hundreds of individuals who fell victim to these illegal practices. Let this be a message to online merchants everywhere: such abuse of consumers and violation of the law will not be tolerated,”
The two companies that will dissolve completely are Camera Wiz and Sonic Photo. The following five companies will completely revamp their business practices and continue operation: Best Price Camera, Foto Connection, 1 Way Photo, 86th Street Photo and Broadway Photo, LLC.
According to a report released by the Attorney General’s Office, the trouble for consumers began after the order had been placed. The victim gets a phone call from a dealer sales rep who either advises switching to another, supposedly superior product, or claims the product purchased is designed for a foreign market and lacks the US warranty and English language instructions.
Or the salesman will attempt to get the victim to buy upgraded or overpriced items (HDMI cables, screen cleaning kits, mounts, practically worthless extended warranties, etc.) If the customer said no the store would simply not ship the product.
If the customer encountered a problem with the main purchase, or were dissatisfied with an accessory, these unscrupulous companies make returning them almost impossible by requiring customers to speak to a live representative during limited business hours and then refusing to answer those calls.