New York Sues SmartBuy Alleging Scams on Soldiers
SmartBuy, a national computer seller, is being sued by the state of New York. Attorney General Andrew Cuomo sued SmartBuy on behalf of the state, claiming that they were scamming soldiers by grossly over pricing computers and charging usurious interest rates. SmartBuy allegedly purchased the computes not from wholesalers, but retail stores, and then re-sold to them to military personnel. SmartBuy has several locations across the United States. The Attorney General believes all operate in the same manner.
Allegedly, SmartBuy would buy the laptops at stores like Wal-Mart, then re-sell them to soldiers near military bases, at interest rates up to 325 percent.
Attorney General Andrew Cuomo accused the retailer of fraudulent and deceptive conduct in connection with the illegal consumer lending and deceptive retail sales of computers and other electronic consumer equipment. The lawsuit seeks restitution to consumers, voidance of the financing agreements, disgorgement of profits from the defendants for consumer sales and financing at SmartBuy, and penalties and costs. In the complaint, Cuomo states:
SmartBuy stores...are strategically located to target sales of computers, electronic consumer goods and financing to active duty military service members at greatly inflated prices and with excessive and usurious financing arrangements.... All of the sales through the SmartBuy Watertown location have been financed through... unlicensed foreign corporations.
Cuomo also wrote a letter to Secretary of Defense Robert Gates to inform him that a number of members of the military were purchasing computers from SmartBuy.
An attorney for SmartBuy disputed the accusation in a statement released Wednesday. "We just don't understand how the Attorney General's Office arrived at this allegation," said attorney Woody Webb in the release. "SmartBuy does not deceive its customers, all of whom are made aware that the exact merchandise SmartBuy sells may be available by other sellers at a lower price."
Read the full complaint here:
Related Resources:
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Company denies deceptive trade practices with soldiers (Fayetteville Observer)
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Attorney General Cuomo Press Release (NY Attorney General)
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Letter to Defense Secretary Robert Gates (NY Attorney General)
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State Interest Rates Laws (FindLaw)