Plug pulled on Internet scam artists

BUFFALO, N.Y. (WIVB) - News 4 has a warning about an online scam involving the sale of electronics.

When Christopher Hough went online to look for a camera, he thought he found a great website offering a great deal.

Hough said, "(I) gave them the credit card number, thought I was done. Noticed a little blurb on there that said, please call back the next business day, to discuss the purchase."

And when Christopher called the Internet retailer based in New York City, to confirm his order, it was classic bait and switch.

Hough said, "And they said, but you know the camera you purchased in the Japanese version. All of the controls and all of the graphics that would come up, and the lettering would all be in Japanese."

The American-made camera would be $100 dollars more, and a decent battery would be another $75 dollars. So Christopher cancelled the deal.

Hough said, "And then they just kind of went nuts, berating language, I don't know what I am doing, don't I shop on the Internet; I have to buy this camera. Real good customer service, so I just hung up and said goodbye."

New York Attorney General Andrew Cuomo is cracking down on seven New York City based Internet retailers, including the company that tried to rip off Christopher Hough.

Some of the addresses the retailers were using included at least one United States Post Office.

The companies agreed to pay back consumers more than $600,000 dollars. Two of them have gone out of business.

The Better Business Bureau's Ellen Tucker told News 4, the bureau logged thousands of complaints against the seven companies which have done business under dozens of different names.

Tucker said, "They would either call the consumer and say this product is no longer available, however, we do have another product that is similar for $100 more, your typical bait and switch type activity."

The seven New York City retailers have agreed to pay more than $600,000 dollars back to consumers to settle the complaints with the attorney general.

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Press Release

ATTORNEY GENERAL CUOMO SECURES AGREEMENTS WITH SEVEN ELECTRONICS COMPANIES IN NEW YORK FOR USING ILLEGAL ONLINE BUSINESS PRACTICES TO SCAM CONSUMERS NATIONWIDE

Cuomo’s Agreements Will Deliver $665,000 in Restitution to Consumers Nationwide who were Scammed By Fraudulent Companies AG Also Announces Partnership with NY Better Business Bureau and ResellerRatings.com to Quickly Detect and Prosecute Illegal Online Business Practices

NEW YORK, NY (June 25, 2009) - Attorney General Andrew M. Cuomo today announced settlement agreements with seven online electronics stores located in New York for engaging in a variety of illegal and fraudulent business practices that scammed consumers nationwide out of hundreds of thousands of dollars. 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.

“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 Cuomo. “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.”

Attorney General Cuomo’s investigation revealed that these seven companies would advertise consumer electronics, such as cameras, camcorders, projectors, and related accessories online at prices significantly lower than their competitors to induce consumers to place orders via the internet. Once an order was placed, the companies would call consumers and try to sell them additional or “upgraded” merchandise at inflated prices. If the consumer refused to purchase the additional merchandise, the companies would cancel the sale or claim the item was backordered for months. If the consumer did agree to purchase the additional merchandise, the companies would send them lower quality merchandise than what was promised, or merchandise that the consumer never ordered in the first place. When customers tried to return the items, they would either be denied or be slammed with undisclosed fees. All of the companies further limited customers’ ability to return merchandise by requiring them to speak to a live customer representative during limited business hours, and then refusing to answer those telephone calls.

Under the agreements secured today by Cuomo, two of the companies, CAMERA WIZ and SONIC PHOTO, will dissolve completely. The following five companies will completely revamp their business practices