Jewelry Retailer to Pay $500,000 over False Credit Promises
July 15, 25
(IDEX Online) - A US jewelry retailer has agreed to a $500,000 court settlement after it was accused of misleading consumers by falsely promoting a store credit line as a way to build credit.
Attractive Gems Jewelers, based in San Diego, California, and its two owners, engaged in deceptive lending practices between 2020 and 2022, according to a statement from the San Diego County District Attorney.
Attractive Gems claimed to offer a $10,000 revolving credit line that would help people build or repair their credit.
Their marketing—often via paid influencers—promised that customers that their store-only line of credit would be reported to all three major credit bureaus, boosting their credit score.
But after customers paid their $149.99 annual fee, the company stopped reporting the credit line to credit bureaus, rendering it largely useless.
Of the 18,600 customers who opened a line of credit with Attractive Gems, only 56 of them actually used it to buy jewelry. The primary aim was to improve their credit score.
"Attractive Gems Jewelers lured consumers in — including military servicemembers based in Southern California — with false promises of helping to build their credit," said California Attorney General Rob Bonta.
"Today's settlement provides important restitution for those harmed by Attractive Gem's attempt to take advantage of struggling consumers, and a reminder to those offering credit products that they need to play by the rules."
Attractive Gems hired social media influencers to promote the credit line and carried on selling it even after the credit bureaus said they were dropping Attractive Gems from their consumer credit reports.
The settlement does not constitute an admission of liability by Attractive Gems.