BALTIMORE, MD—Maryland Attorney General Brian E. Frosh this week announced that the state’s Consumer Protection Division, along with 17 other State Attorneys General and the Federal Trade Commission (FTC), joined a multistate agreement resolving allegations that national jewelry retailer Harris Jewelry targeted and defrauded military servicemembers and veterans. The states and the FTC alleged that the jewelry company used deceptive marketing tactics to lure active duty servicemembers to their financing program, falsely claiming that investing in this program would improve servicemembers’ credit scores. Instead, servicemembers were tricked into obtaining high-interest loans on overpriced, poor-quality jewelry that saddled the servicemembers with thousands of dollars of debt and worsened their credit. In addition to agreeing to provide debt forgiveness and refunds, Harris Jewelry has agreed to dissolve its businesses. Harris does not have any physical store locations in Maryland.

The Attorneys General and the FTC alleged that Harris Jewelry engaged in unfair and deceptive trade practices that violated the Consumer Protection Act and the Miltary Lending Act. At the center of the alleged violations was Harris’ practice of targeting recent recruits with lower pay grades with the “Harris Program,” which falsely represented that soldiers with poor or no credit could improve their credit scores by financing their purchases. Harris Jewelry is also alleged to have added “Protection Plans” to their sales at an added cost without soldiers’ consent, a practice that is also illegal. The protection plans ranged in price from $389.99 to $349.99 and covered services like resizing jewelry and battery replacement for watches.

“Harris Jewelry targeted and preyed upon hundreds of Maryland servicemembers, locking them into protection plans and financing programs without their approval,” said Attorney General Frosh. “The agreement announced today shuts Harris down and returns tens of thousands of dollars owed to Maryland consumers.”

Under the agreement, Harris Jewelry has agreed to forgive existing debts owed by service members that total approximately $15 million, including $128,995.57 owed by 102 Maryland service members. Harris has also agreed to pay full restitution to service members who purchased jewelry protection plans – an amount that could total as much as $10.9 million. Approximately 274 Maryland service members are entitled to refunds totaling $63,399.67.

Harris Jewelry has agreed to dissolve its operations and to cease collecting on its existing contracts with service members and not sell these contracts to any third parties. The agreement also requires Harris and its officers to:

• cease making misleading or unsubstantiated claims, including about their ability to improve consumers’ credit histories;
• cease offering or selling ancillary products, such as protection plans, to consumers in connection with financed purchases;
• only debit amounts from consumers’ accounts after obtaining written authorizations that disclose material terms;
• comply with disclosure requirements when lending to members of the military; and,
• not collect amounts under financed agreements unless they contain the disclosures required under federal law.

In addition to Maryland, the agreement was joined by the Attorneys General of Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Nevada, New York, North Carolina, Pennsylvania, and Virginia.

Consumers who are eligible for refunds will be contacted by a Claims Administrator. Consumers with questions may also contact the Attorney General’s Consumer Protection Division at 410-528-8662 or 888-743-0023.