The Executive Director of Hawaii’s Office of Consumer Protection, Stephen Levins, recently announced that $34.2 million will be repaid to 46,000 service members and veterans who were deceived and defrauded by Harris Jewelry.
Harris Jewelry is accused of using marketing tactics as part of a scheme to lure active-duty service members to their financing program, falsely claiming that investing in this program would improve their overall credit scores, according to a July 20 press release. Instead, service members were tricked into obtaining high-interest loans on overpriced, poor-quality jewelry that saddled them with thousands of dollars of debt and worsened their credit.
“Servicemembers should not be taken advantage of by businesses looking to make a quick buck,” Levins said, in the release. “This case goes a long way in holding Harris Jewelry accountable for engaging in alleged unfair and deceptive trade practices and will provide needed monetary relief to victims harmed by its conduct.”
In addition to being ordered to pay $1 million to all 18 states that are part of the suit, Harris Jewelry was ordered to refund tens of thousands of service members for warranties they were tricked into purchasing, to stop collecting millions of dollars of debt, to correct bad credit scores, and dissolve all of Harris Jewelry’s businesses, the release stated.
“The jewelry itself was significantly overpriced and poor quality,” government officials said in the release. “The investigation found that the company dramatically inflated the retail price of its products, generally by multiplying its wholesale cost by six or seven times, and in some cases 10 times the wholesale cost. For example, Harris Jewelry purchased its popular Mother’s Medal of Honor at $77.70 but sold it at $799. The jewelry was not worth the price and consumers often reported stones falling out, chains breaking, and the finish fading.”
Headquartered in Hauppauge, New York, Harris Jewelry, operated retail stores near and on military bases around the country, with their business model being designed to primarily target service members, according to the release.
The multi-state investigation found service members were enticed into retail stores through a marketing scheme, dubbed “Operation Teddy Bear,” in which Harris Jewelry advertised teddy bears in military uniforms with promises of charitable donations, the release stated.
Service members and veterans who had a Harris Jewelry predatory financing loan between January 2014 and July 2022 are eligible for restitution in what they paid for warranties, according to the release.