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Dell Found Guilty Of Fraud In New York

By - Source: Tom's Hardware | B 9 comments

The Office of the Attorney General yesterday won what it’s describing as a “groundbreaking” lawsuit against Dell and its affiliate, Dell Financial Services.

In a case AG Andrew M. Cuomo filed last year on behalf of the state, Justice Joseph C. Teresi ruled that Dell and DFS had engaged in fraud, false advertising, deceptive business practices, and abusive debt collection practices.

According to the ruling, Dell failed to provide consumers with the tech support they were entitled to under their warranty or service contract by repeatedly failing to provide timely onsite repairs to those who purchased service contracts promising that. Dell was also found guilty of pressuring consumers (including those entitled to onsite repair) into attempting to repair the computers themselves.

Having heard all the horror stories about support lines (some of you have no doubt been on the wrong end of this) it’s not surprising to hear that Dell was also found guilty of discouraging consumers from seeking technical support. Apparently those who called Dell’s toll free number were subjected to long wait times, repeated transfers, and frequent disconnections.

Justice Teresi said that Dell lured consumers into purchasing its products with advertisements that offered appealing “no interest” or “no payment” promotions. However, many customers, even those with very good credit scores, were denied these deals and instead offered financing at higher interest rates. He also said that often, Dell and DFS failed to clearly inform these customers that they had not in fact qualified for the promotion.

But wait, there’s more. The decision also held that DFS incorrectly billed customers on cancelled orders, returned goods, or accounts they did not authorize Dell to open. DFS then continually harassed them with illegal billing and collection activity. While many people repeatedly contacted the company to advise them of the errors, DFS did not suspend its collection activity and Dell failed to expeditiously credit consumers’ accounts, even though it assured customers it would do so. As a result of these practices, many customers have had their credit ratings harmed.

The Court will hold further proceedings to determine how much restitution Dell will have to pay to its customers and the amount of profits Dell unlawfully earned that must be forfeited to the State.

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  • -1 Hide
    Anonymous , May 28, 2008 4:52 PM
    this sounds like every major business out there
  • 1 Hide
    gm0n3y , May 28, 2008 5:39 PM
    Another reason to build your own PC.
  • 0 Hide
    DXRick , May 28, 2008 7:38 PM
    Well, it is likely that this will turn into a class action lawsuit, and other states will sue them too. Dell will settle, lawyers will get richer, and (hopefully) Dell will change its ways.
  • Display all 9 comments.
  • 0 Hide
    gm0n3y , May 28, 2008 10:27 PM

    Also, if you DIY (and you're not an idiot) you generally have less issues than if you bought a Dell because the quality of the parts in Dells are shite.
  • 0 Hide
    Alternator , May 29, 2008 12:49 AM
    That's a shame to hear, I've had very good customer service from them.
  • 0 Hide
    humalong , May 29, 2008 2:20 PM
    "Dell was also found guilty of pressuring consumers (including those entitled to onsite repair) into attempting to repair the computers themselves."

    uhhhh if those people knew about computers, they wouldnt have bought a Dell


    i can just imagine the phone call...

    tech: "uh ma'am we wont be able to come out until ohhhhh maybe next tuesday..."
    lady: "but ive already been on hold for 3 days, i was hoping you could come sooner"
    tech: "yes maam we are very busy helping our customers (crunch on food)"
    lady: "well alright, but ill have to take more time off from work"
    tech: "actually ma'am tuesday is bad for us also, could i get you to just take a look at it in your free time, i gotta go now. thanks!"
  • 0 Hide
    Anonymous , May 29, 2008 4:51 PM
    Alienware customer service is much worse. I know it's hard to imagine customer service worst than Dell's but it's true. I asked them for their on-site support and they just flat out said 'no'.

    My Alienware was shipped to me, DOA. Sent back for repairs, one month later sent back to me and not fixed. Asked for a refund, they said the 30 day refund period had passed. Asked for on-site support, they said "no."
  • 0 Hide
    DXRick , May 29, 2008 6:54 PM
    Well, this must be good for the Geek Squad. :bounce:  :pt1cable:  :lol:  :lol: 
  • 0 Hide
    vagetaqtd , May 30, 2008 12:45 AM
    Build it yourself or have someone who knows their shite build it for you for a pack of beer and steak dinner.