Bargain-hunters take note.
The Governor’s Office of Consumer Protection announced Monday that it has entered into a settlement with daily deal company Loclly and the company’s principal officer, Michael Ferguson.
Loclly offers consumers discounted vouchers on an array of merchandise and services. Consumers pay Loclly via its website and then print out a voucher that the consumer is to present to a vendor, such as a restaurant, spa or service station.
In the settlement, GOCP alleges that the company committed various violations of the Fair Business Practices Act.
Specifically, Loclly was aware certain vendors were not honoring vouchers for their products, yet Locally continued to advertise and sell vouchers for those products and services, the Governor’s Office of Consumer Protection alleges.
When consumers discovered they were unable to redeem their vouchers, they contacted Loclly, but the company refused to issue refunds and would only offer store credit, the agency said in a press release.
“This was also a violation of Loclly’s promise of ‘100% satisfaction guaranteed’,” the press release states.
Loclly also misled consumers by listing inflated values for vouchers and misrepresenting when deals would expire in order to create a false sense of urgency, according to GOCP.
“These were very troubling allegations,” said John Sours, administrator of the Governor’s Office of Consumer Protection. “Internet transactions have become an integral part of today’s economy. We can’t tolerate misleading practices by online merchants.”
Under the settlement, Loclly and its owner are required to pay a $40,000 civil penalty and $35,000 in administrative expenses. They must also pay $4,105.60 in direct restitution to 42 consumers and another $15,000 to the state as a restitution trust fund for issuing refunds to eligible consumers.
Consumers who believe they may be entitled to compensation under the settlement can fill out a claim form and submit it to GOCP, along with supporting documentation. Claim forms must be postmarked, faxed or hand-delivered no later than 5 p.m. on Oct. 9, in order to be considered for restitution.
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