FOR IMMEDIATE RELEASE: November 17, 2008
CONTACT: Michelle Gatchell Deputy Director of Communications 614-728-0701 mgatchell@ag.state.oh.us
Buyer Be Aware: Going-Out-of-Business Sales
With big name retailers such as Circuit City and Value City Departments Stores announcing massive store closings and bankruptcy filings, Ohio Attorney General Nancy H. Rogers reminds consumers to shop wisely when purchasing from retailers that are going out of business. Although advertised going-out-of-business sales, final liquidation sales, or “everything-must-go” sales, carry a sense of urgency and suggest rock-bottom prices, consumers should remember the risks involved with these sales. Most sales are final and returns may not be accepted. You may want to reconsider before purchasing final sale merchandise. By law, “distress” sales must be limited to a stated period of time, 45 days in Ohio, though an extension to 90 days may be permitted. While many cities require a license for such a sale, each township or municipality is governed by its own ordinances. Consumers that have a gift card for a retailer that is going out of business should redeem it as soon as possible. Gift cards purchased before a business files bankruptcy should be accepted. However, bankruptcy courts have authority to add restrictions. Other things consumers should be on the lookout for include: • False or misleading price comparisons. Items may be advertised half off, but half off of what? The original price may have been inflated to make it sound like more of a bargain than it actually is. • Warranties. Since the business no longer will be there, where will a consumer take the product for service? Can it be repaired at another facility or a service center? • Quality of merchandise. By law, the sellers cannot bring in merchandise that they did not routinely carry. • Sale dates. A business advertising it is going out of business must disclose the beginning and end dates of the sale. • Paid deposits. Consumers who have paid a deposit or have undelivered merchandise can file a proof of claim with the bankruptcy court. Consumers’ claims are unsecured debt and, depending on the terms of the bankruptcy, may not be paid
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A final tip: If a business unexpectedly closes and leaves you with an unfilled order, you do have protections. Consumers who paid for a product or service by credit card are protected by the federal Fair Credit Billing Act (FCBA). This law allows consumers to refuse to pay for credit card “billing errors”, which include undelivered goods or services. To dispute credit card charges, call the toll free number on your account statement. If your credit provider has a dispute form, complete and submit it. Under the FCBA, you must submit your dispute in writing within 60 days after the bill is mailed. Credit card companies may offer additional protections such as extended warranty coverage. For additional information, contact your credit card company. Consumers can file complaints with the Ohio Attorney General’s Office for help disputing credit card charges and filing a proof of claim in bankruptcy court. To file a complaint, visit www.ag4ohio.gov or call 1-877-AG4OHIO (1-877-244-6446).
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