Sued computer seller promises reforms

BUSINESS DIGEST

May 24, 2006|By MEREDITH COHN | MEREDITH COHN,SUN REPORTER

BlueHippo Funding LLC, a Woodlawn computer sales and finance company facing lawsuits and government investigations into its advertising and telemarketing, announced yesterday that it would launch a new quality control program.

The company made no reference to the complaints in a news release, but said that its new "best practices" program would "set high industry standards in customer disclosure, quality control, service and, where necessary, complaint resolution."

"In the past, in some instances, we have not done a good job at explaining all of our practices, and there's a lot of misinformation in the public domain. We feel it's not only important to explain our practices, but to set a standard for the industry," said Michael Waldron, a spokesman for the company.

Consumer lawsuits in California and Maryland and by the Illinois attorney general accuse Blue Hippo of collecting money from customers' bank accounts for several months and not providing promised computers. The suits also allege that customers ended up paying $2,000 or more for low-end computers available elsewhere for $500.

The company has denied wrongdoing in the past. It has said that it takes considerable risk in selling computers to consumers with poor credit.

The company also is under investigation by the Federal Trade Commission and by the Florida attorney general.

A spokeswoman for the Illinois attorney general's office would not comment on BlueHippo's announcement yesterday.

Waldron declined comment on the lawsuits but said, "When questions are raised by appropriate regulatory agencies, we are fully willing to enter into discussions with them."

A lawyer representing customers who filed the two federal lawsuits in March, and are seeking class action status, said the new company program changes nothing.

"BlueHippo is a company that makes its money by taking hundreds of dollars each from thousands of consumers," said David J. Marshall, a lawyer in Washington for Katz, Marshall & Banks LLP. "BlueHippo debits consumers' checking accounts and doesn't provide anything in return."

meredith.cohn@baltsun.com

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