SmartBuy Agrees To Pay $9.5M To Wipe Out Soldiers' Debt
New York state Attorney General Eric Schneiderman has reached a $9.5 million settlement with retailer SmartBuy and its affiliated companies over debt fraud aimed at Fort Drum soldiers.
Schneiderman says SmartBuy operated a kiosk and small storefront at Salmon Run Mall and ruined the credit of thousands of soldiers through fraudulent charges.
SmartBuy purchased merchandise from stores like Sam's Club, Costco and Walmart. The items were then marked up by 200 to 325 percent and included an added interest of 10 to 25 percent. The interest rates averaged 244 percent.
The settlement, along with an earlier one with SmartBuy, wipes out $12.9 million in debt for more than 4,000 soldiers nationwide.
Schneiderman said Monday SmartBuy sales clerks aggressively pushed the sales of electronic equipment, including laptops, gaming systems and flat screen televisions to soldiers.
Soldiers were talked out of paying cash and pressured into payment contracts with hidden fees and exorbitant interest.
Fayetteville, N.C.-based SmartBuy closed its local operations after Schneiderman demanded it stop deceptive practices and reimburse soldiers.
A lawyer for the company says it was satisfied with the settlement that protects soldiers' credit ratings.
Wednesday, October 22, 2014, Watertown, NY
On Wall Street