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TRENTON
– Attorney General Anne Milgram announced
today that New Jersey has entered into a
settlement agreement with Dell, Inc., under
which the retail computer firm will provide
restitution to customers who experienced
problems with its financing promotions,
rebate offers, technical support and repair
policies.
The
agreement calls for $25,000 to be placed
in escrow by Dell to cover restitution to
customers in New Jersey. New Jersey consumers
who file claims by April 13, 2009 may be
eligible for restitution.
A
similar but separate agreement involving
34 other states calls for Dell to put money
into escrow to fund consumer restitution.
Under the respective settlement agreements,
Dell, Inc. and its subsidiary, Dell Financial
Services, admit no wrongdoing.
In addition to the financial terms, New
Jersey’s settlement with Dell includes
numerous disclosure provisions aimed at
ensuring that Dell customers are given clear
and accurate information about the terms
of any financing offers, as well as their
right to cancel orders within three days
of receiving final credit approval. The
settlement also requires Dell to, among
other things, fulfill warranty obligations
within 30 days of being notified of a defective
product or other problem, and to mail rebates
within the time frame specified or, if no
date is specified, within 30 days.
“
This settlement goes a long way toward protecting
New Jersey consumers by ensuring they have
all the information they need to make a
considered purchasing decision, and to know
their rights as buyers, “ said Attorney
General Milgram.
“At
the same time,” Milgram continued,
“the agreement includes numerous provisions
designed to ensure that, when warranty issues
or problems with the product arise, Dell
is responsive to the needs of the consumer.
We are committed to holding businesses accountable,
and to ensuring that New Jersey consumers
are dealt with fairly.”
Dell
is a Delaware corporation with its headquarters
located in Round Rock, Texas. Under terms
of its settlement with New Jersey, Dell
has agreed to the following:
Financing
and Credit Offers
- To
disclose in its advertising of promotional
credit offers that the majority of consumers
who apply won't qualify for the best annual
percentage rate (APR), and disclose the
range of initial APRs that consumers who
are not considered the "most qualified
borrowers" are likely to receive.
- Inform
consumers considering applying for promotional
financing that the application is for
a revolving open credit account, that
minimum monthly payments are required
and that approval of the account does
not guarantee that the consumer will also
qualify for conditional financing promotions
(such as zero-percent interest for 90
days). Explain how finance charges are
calculated, disclose any penalties and
inform the consumer whether subsequent
purchases made using the credit account
will be subject to the same or different
financing terms.
- At
the time of credit acceptance, disclose
whether the applicant has qualified for
any conditional financing promotion.
Warranties
and Services
-
Fulfill its warranty obligations within
30 days from the date of
notification or receipt of a defective
product.
- Disclose
whether phone-based troubleshooting or
remote diagnosis
is required before Dell will provide on-site
repair or warranty-related
service.
Rebates
-
If a rebate is available, provide the
necessary rebate documentation at the
time product is delivered or the service
is provided.
- Mail
rebates within the specified timeframe,
or within 30 days
if no date is specified.
Dell also has agreed to implement written
policies to ensure compliance with the settlement,
including procedures that address issues
such as:
-
Informing consumers of their right to
cancel orders made with
the Dell Credit Account within three days
after receiving final credit
approval and the written terms and conditions.
-
Improved communication between Dell and
Dell Financial Services when a
consumer returns a product purchased with
credit.
- Removing
consumer accounts from collection agencies
and
providing accurate information to credit-reporting
bureaus.
-
Substantiate any claims Dell makes about
the quality of its
customer service. Dell can use the term
"award-winning" to describe
its
customer service only if the company received
such an award within the
past 18 months.
It is not yet known how many consumers in
New Jersey may be entitled to refunds under
the settlement. Consumers may be eligible
for restitution if: 1) They have a valid
complaint concerning a product that was
purchased between April 1, 2005, and April
13, 2009, and is addressed by the agreement
and 2) Dell owes them money.
New Jersey residents who have not submitted
complaints to date but believe they
are eligible for refunds should contact
the Division of Consumer Affairs at (800)
242-5846 (toll free, New Jersey only) or
(973) 504-6200 or visit the Division Web
site at http://www.njconsumeraffairs.gov/.
The deadline to submit claims is April 13,
2009.
Deputy Attorney General Cathleen O’Donnell,
assigned to the Consumer Fraud Prosecution
Section of the Division of Law, handled
the Dell settlement on behalf of the state.
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