New York finds Dell guilty of false advertising, fraud


New York judge Joseph Teresi has found Dell to be guilty of fraud and false advertising, saying…

“Dell has engaged in repeated misleading, deceptive and unlawful business conduct, including false and deceptive advertising of financing promotions and the terms of warranties, fraudulent, misleading and deceptive practices in credit financing and failure to provide warranty service and rebates.”

The New York attorney general’s office apparently received around 700 complaints before filing the lawsuit a year ago and has received more than 1,000 additional complaints since then. It’s thought that of the roughly six million transactions that Dell completed in the state of New York between 2003 and 2006, only about 7% of those customers qualified for financing deals.

According to the Associated Press,

“Most applicants, if approved for credit, were offered very high interest rate revolving credit accounts ranging from approximately 16 percent up to almost 30 percent interest without the prominently advertised promotional interest deferral,” Teresi wrote…

The judge also noted many affidavits alleging long telephone waits on hold for technical support, numerous phone transfers among departments, the need for repeated customer calls to get through and “numerous instances” when Dell refused to provide on-site service before it had determined what parts needed to be replaced. Some customers said they waited weeks, months and even years.

The judge also faulted Dell for denying timely rebate requests that contained all required documentation and ordered Dell Financial Services to stop reporting payments were late from customers who offered documentation they had already returned equipment for full refunds.

Dell has said that it disagrees with the decision and “would be putting up a vigorous defense of its position,” but hasn’t yet appealed the verdict.