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FTC refunds victims of a decades-old computer financing scheme

The agency has closed the book on a long-running operation that exploited consumers

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Photo (c) SARINYAGINNGAM - Getty Images
The Federal Trade Commission (FTC) reports that it has sent checks to more than 4,500 consumers who lost money to a company called Blue Hippo that sold high-priced computers on an installment plan.

The case stretches back to the early 2000s. At the time, the internet was becoming mainstream, but smartphones and tablets were only a glimmer in Steve Jobs’ eye. People who wanted to access the growing benefits of the internet needed a personal computer.

In 2008, the FTC charged BlueHippo Funding, LLC and affiliate BlueHippo Capital, LLC with promising to finance new computers that they sold at a very high price. The agency said the companies collected money from customers and then failed to provide them with computers. 

The FTC also claimed that the two companies failed to disclose key terms of BlueHippo’s refund policy to customers prior to receiving payments.

ConsumerAffairs reported extensively on the issue in 2007 and received many complaints from consumers who said the devices they received were old and out of date. We found that Wal-Mart's laptop and printer combo could be purchased for $571 at the time. In contrast, BlueHippo's slower laptop package carried a price tag of up to $2,698 -- almost five times the cost of Wal-Mart's better offering.

Contempt charges

After agreeing to a settlement with the FTC, the agency charged that BlueHippo continued to engage in deceptive practices. In 2009, the FTC sued the companies again, as well as CEO and sole owner Joseph Rensin, charging them with contempt for violating the 2008 order. 

After a lengthy court battle, the FTC won. It is now using the money it recovered from Rensin to provide more than $103,000 in refunds to consumers.

The FTC has the names and addresses of consumers who are eligible for a refund. The agency said people who receive checks should deposit or cash them within 90 days. 

Consumers who have questions about their checks can call the refund administrator Analytics, Inc., at 1-855-558-1233. It’s also important to remember that the FTC never requires people to pay money or provide account information to cash a refund check.

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