OAKLAND – California Attorney General Rob Bonta today joined the Federal Trade Commission and 17 state attorneys general in announcing a $34.2 million settlement with Harris Jewelers for violations of state and federal consumer protection laws. Today’s settlement resolves allegations that Harris Jewelers targeted military service members with dishonest sales and financing tactics at now-shuttered stores located near military bases across the country, including Naval Base San Diego. As part of the settlement, Harris Jewelers will be required to write off $21.3 million in consumer debt nationwide, including more than $800,000 in debt owed by Californians, and provide nearly $12.9 million in consumer refunds, including more than $700,000 to service members in California.
“During Military Consumer Protection Month, we recognize that while our military service members devote their lives to protecting our country, there are still some who see them as financial targets to be exploited,” said Attorney General Bonta. “Today’s settlement should serve as a warning to any businesses thinking of engaging in shady practices to make an extra buck: We will not stand idly by. The California Department of Justice is committed to protecting our service members as they work day in and day out to protect all of us.”
Harris Jewelers is a nationwide retailer that sold military-themed gifts, jewelry, and watches at stores located on or near military bases across the country. Harris Jewelers targeted active duty service members with the sales pitch that purchasing from them on credit would, regardless of their credit history or subsequent payments, improve service members’ credit scores. Harris Jewelers also utilized unfair and deceptive sales practices in connection with its jewelry protection plan and failed to include disclosures in its advertisements and retail installment sales contracts as required under the Truth in Lending Act and Military Lending Act.
As part of today’s settlement, Harris Jewelers will be required to stop collecting over $21.3 million in outstanding debt that is held by 13,426 servicemembers and to provide nearly $12.9 million in refunds to 46,204 servicemembers who paid for protection plans. Harris Jewelry will also be required to vacate judgments against 112 consumers totaling more than $115,000 and delete any negative credit entries reported to consumer reporting agencies. In addition, Harris Jewelers will be required to comply with significant injunctive terms, including ceasing operation of its businesses and a ban on the future marketing or sale of related products.
Attorney General Bonta joins the Federal Trade Commission and the attorneys general of Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maryland, Nevada, New York, North Carolina, Pennsylvania, Virginia, and Washington.
A copy of the settlement, which is subject to court approval, can be found here.