A national chain of jewelry stores is under investigation for ripping off service members, including those posted at Fort Bragg and Camp Lejeune, the North Carolina attorney general announced recently.
Attorneys general in 14 states, including North Carolina Attorney General Josh Stein, have been investigating Harris Jewelry for illegal lending practices and charging troops huge markups at stores near or on military bases around the country, Stein’s office said in a recent press release.
New York Attorney General Barbara Underwood announced a lawsuit against the company, which is headquartered in that state. “Harris Jewelry used servicemembers as pawns in a predatory scheme,” said Underwood. “My office will not tolerate companies that seek to take advantage of New Yorkers in order to line their own pockets.”
The lawsuit accuses the company, which has stores near Fort Bragg in Fayetteville and Camp Lejeune in Jacksonville, North Carolina, of operating an illegal lending scheme, according to the North Carolina attorney general.
The company sells commemorative military jewelry and other items, including “Mother’s Medal of Honor,” “Token of Pride Coin,” and “Forever as One Dog Tag Necklace,” according to the New York attorney general.
The lawsuit also accuses the company of targeting troops with military-themed jewelry of questionable quality sold at a markup of six to 10 times the wholesale cost, according to The Fayetteville Observer. The industry standard for markup is two or three times the wholesale cost, the newspaper reported.
The stores advertise the jewelry to military members with a cost “per payday” so customers might not really know how much they end up paying, the newspaper notes.
The New York Attorney General’s Office explains: “For example, Harris Jewelry allegedly purchases the popularly sold ‘Mother’s Medal of Honor’ for $77.70 and then sells it for $799 plus warranties and interest. The ‘Forever as One Dog Tag Necklace’ is allegedly purchased at $97 and sold for $699 plus warranties and interest.”
Harris Jewelry would allegedly tell troops that they can use the company financing to improve their credit and buy jewelry, then try to sell them enough to max out their credit limit, North Carolina officials said.
The North Carolina Attorney General’s Office said, “Harris Jewelry entices local servicemembers into the stores with ‘Operation Teddy Bear’ — a purported charitable program in which Harris Jewelry sells teddy bears in military uniforms with promises of charitable donations to a military-related charity.”
Earlier this year, North Carolina and a number of other states settled a lawsuit against Operation Troop Aid, which sold the teddy bears, accusing the company of allowing Harris Jewelry to not account for the donations.
“Harris Jewelry operates in full compliance with the laws that regulate our industry,” the company said to The Fayetteville Observer responding to the lawsuit.
“Harris Jewelry stands behind its decades-old business model. The New York Attorney General has unfortunately reached the wrong conclusions about our business and the work we do,” the company said, according to the newspaper.
Attorneys general from North Carolina, New York, Tennessee, Nevada, Delaware, Georgia, Hawaii, Idaho, Illinois, Kansas, Louisiana, Maryland, Pennsylvania and Virginia are involved in the investigation.
Charles Duncan: 843-626-0301, @duncanreporting