First things first – Happy Thanksgiving to one and all!
Now down to business. I joined BBB team nearly four years ago as a novice to the BBB world. My first day, my first week, my first month, and every month thereafter, BBB Maryland buzz has been all about BlueHippo. While I’ve never met the Hippo, I’ve talked to countless victims on the phone who can’t file a BlueHippo (BH) complaint online because hey – they never received their computer!
Let’s get down to the bottom line of the business practices in question by BBB, Attorneys General throughout US and the FTC.
- Target marketing to those with poor credit, no credit. That means, they are directly marketing to those who can least afford (literally) to be victimized by poor or deceptive business practices. BBB believes this to be predatory marketing.
- Requesting a down payment ranging from $99 to $124 to finance purchase of personal computers and other electronics with weekly or bi-weekly payments ranging from $36 to $88 (FTC report 2/25/08). This “lay away” plan means a consumer usually pays approximately $2,000 for an $800 Dell computer!
- According to BlueHippo’s website, a consumer “builds a little credit history” through payments and after “6-13 consecutive weeks”, they will finance the balance of the purchase price and ship the computer. The problem? Of the 4,183 BH complaints received by this BBB in 36 months, 1,497 or one-third are from consumers with delivery issues. They NEVER got their computer!
- And, according to BlueHippo’s website, “customers are entering into a fully cancelable but binding law away agreement”. Your BBB received 1,100 complaints to date from consumers who thought they were canceling per their right, but the automatic billing continues, they were promised refunds never received, or cancellation meant ordering from the BH online “store” and yes – we’ve received complaints from consumers who then didn’t receive those products!
If you read the FTC’s 2/25/08 release on their $5 million settlement with BlueHippo, you will note BH was sited as violating numerous federal regulations. The settlement barred BH from misrepresentations in their marketing, refunds, cancellations, exchanges and permanently prohibited BH from violating the Mail Order Rule and a number other regulations. So what happened?
According to FTC’s November 12, 2009 Release - from 2008 until April 2009, BlueHippo accepted orders for financing computers from 35,000 consumers, pocketed $15 million in payments, and shipped a single computer. In addition, according to the FTC, when they went back to the court regarding the continued business practices of this company seeking further penalties, BlueHippo then shipped out 4,056 computers of which 2,594 had not even met the financing criteria. Meaning, when prompted by potential threat of government action, BH may deliver what was promised – not because it is simply the right thing to do!
Okay – why should you care? BlueHippo is in YOUR back yard Maryland! This business ranks #20 in complaints within BBB system nationwide for the past 12 months. You know who has more complaints than BH? DirecTV, T-Mobile, Sprint, Dell, FreeCreditReport.com, and rip off companies selling the acai berry miracles and free gas!!!!! Excluding the “rip off” companies, these other businesses pay millions of dollars for national advertising and are also some of our country’s largest selling retailers. BH is NOT in this league – but yet, they are among the “league’s” leaders with their complaint score!
While BlueHippo no longer markets directly to Marylanders, and BBB Greater Maryland has not received a complaint from a Marylander within the past 12 months, your grandparents, family and friends living elsewhere in the US have indeed fell for this promise of entering the world of technology. Remind them to use a piggy bank rather than a hippo, spread the word and don’t be a NIMBY on this one!
Holidays = opportunity for scams and rip-offs. Be smart in your holiday shopping and pick up some helpful tips by visiting our News Center at www.bbb.org . Talk soon - Angie
