October 17, 2006
ATTORNEY GENERAL CURRAN ANNOUNCES SETTLEMENT WITH
Maryland Attorney General J. Joseph Curran, Jr. announced today
that his Consumer Protection Division, working in conjunction
with 17 other Attorneys General, has reached a settlement
Inc., which trades under the name Friedman’s Jewelers. In
the settlement, Friedman’s, Inc. has agreed to change its
practices to provide clear and conspicuous point-of-sale disclosures
when offering credit insurance to consumers.
investigation of the nation’s third largest jewelry
chain, alleged that the jewelry company engaged in unfair or deceptive
trade practices by failing to adequately inform consumers regarding
insurance fees. The States alleged that Friedman’s, Inc.,
when selling jewelry and financing the purchase, would charge premiums
for credit life, credit disability and property insurance without
adequately informing consumers that they were purchasing insurance.
January 2005, Friedman’s, Inc. filed bankruptcy. At that
time, Friedman’s had 560 jewelry stores in 21 states. After
filing bankruptcy, Friedman’s has 427 jewelry stores in 20
states. Currently, Friedman’s, Inc. has five stores in Maryland.
Friedman’s, Inc. has denied any wrongdoing. However, under
the terms of the settlement, Friedman’s has agreed to provide
clear and conspicuous disclosures when offering credit insurance
to consumers in the future. Additionally, Friedman’s has
agreed to comply with Federal Truth in lending laws and with licensing
laws before offering credit insurance. Friedman’s is paying
$90,000 to Maryland under the agreement.
“It is important that consumers receive clear and adequate
information when making a purchase and are not unfairly charged
for products they do not want or need,” Curran said.
The Attorney General offers the following consumer tips:
financing with an in-store financing option, check other financing
options available to you and compare
terms such as the interest rate;
purchasing any goods or services with a financing agreement,
carefully review the financing documents
about any add on fees or costs above those you initially agreed
or expected to pay;
insurance that is sold as a part of a financing transaction is
overpriced, so it is advisable
to refuse to purchase
deciding whether to purchase credit insurance, review the terms
of the credit insurance contract
for all exclusions and
compare the price of the credit insurance to the amount that would
be paid off; and
electing to purchase credit insurance for any transactions, make
sure the company is licensed to sell
insurance in Maryland
and is in good standing.
The other states participating in the settlement are Alabama, Arkansas,
Delaware, Florida, Georgia, Illinois, Indiana, Kentucky, Louisiana,
Mississippi, Missouri, North Carolina, Ohio, Oklahoma, South
Carolina, Tennessee and Texas.