By Lookout Staff
February 19 – Nearly 100 customers of a Santa Monica-based online electronics dealer will share in a more than $145,000 settlement, the largest recovery in a consumer protection prosecution in the city’s history, Santa Monica officials announced Wednesday.
The City charged that TV Authority, which went out of business in 2007, never delivered the plasma TVs and other high-end electronics paid for by customers from across the U.S. and abroad.
Under the agreement, the criminal charges against the owners of TV Authority were dismissed in exchange for full refunds to all known customers who still had not received TVs or refunds.
“The City’s investigation showed that the business developed problems meeting a high volume of orders in 2006, but continued to take payments long after, resulting in dozens of consumers who lost their money,” said Deputy City Attorney Eda Suh who prosecuted the case.
The defendants were charged with violating a California law that makes it a crime for online and telephonic sellers to take payment but not ship the goods or provide a refund within 30 days, City officials said.
“This law is a valuable tool for prosecutors and consumers when internet sales go bad,” Suh said. “It holds business accountable to deliver the goods or give a refund.”
The City’s Consumer Protection Unit first learned of the problem in late 2006 when several former customers complained that they had paid for TVs they never received, Suh said.
A year later, the unit filed 14 criminal charges against the former owners of TV Authority.
“The business owners had claimed that they were working to provide refunds to all customers, but this job was never completed,” Suh said.
More customers stepped forward after a court in January 2008 ordered TV Authority to shut down all advertisement on the Internet and post a notice informing the public that it was being investigated by the City.
The breakthrough in the case came in March 2008 when one of the former owners agreed to provide prosecutors with a copy of TV Authority’s complete customer database, officials said.
The consumer unit then wrote letters to the more than 5,000 former customers on the list. One hundred claimed they had still had not received their TVs or refunds totaling nearly $150,000.
“We are pleased that the business owners were willing to cooperate and do the right thing,” said Suh. “In these uncertain economic times, each dollar returned is sure to help.”
