Dell, the personal computer giant was slapped in mid-May with a lawsuit from the state of New York for “engaging in bait and switch financing tactics and failing to provide their customers with adequate customer service.”
The lawsuit, filed by New York State Attorney General, Andrew M. Cuomo, accuses Dell and its money arm, Dell Financial Services, of “luring consumers to purchase its products with advertisements that offered attractive ‘no interest’ and/or ‘no payment’ financing promotions,” according to a statement from Cuomo’s office.
In reality, even customers with good credit were paying interest rates as high as 20% without ever being told that they had not qualified for the promotional rates, Cuomo said.
In the petition, Dell’s rebate practices are also brought into question. “Further, although Dell induces consumers to purchase equipment by offering rebates, many consumers who timely submit their rebate paperwork do not receive their promised rebate and get a ‘runaround’ when they subsequently contact Dell to inquire about it.”
The lawsuit also alleges that Dell Financial Services billed customers incorrectly on returns, as well as canceled orders.
“Although many consumers repeatedly contacted Dell and/or DFS to advise them of the errors, DFS did not suspend its collection activity and Dell failed to expeditiously credit consumers’ accounts, even after assuring consumers it would do so … as a result, many consumers have been subjected to harassing collection calls for months on end and have had their credit ratings harmed.”
Financial shenanigans not withstanding, Dell’s customer service and support has rightfully also come under attack. “At Dell, customer service means no service at all. Dell’s consumers were intentionally misled, and they had to pay for that privilege.” Cuomo said.
Customers often faced “a nightmarish array of obstacles in their quest for service.” Allegations include:
- Repeatedly failing to provide timely onsite repair to consumers who purchased service contracts promising “onsite” and expedited service
- Pressuring consumers, including those who purchased service contracts promising “onsite” repair, to remove the external cover of their computer and remove, reinstall, and manipulate hardware components
- Discouraging consumers from seeking technical support. Those who called Dell’s toll-free number were subjected to long wait times, repeated transfers and frequent disconnections.
- Using defective “refurbished” components to repair or replace consumer equipment.
The lawsuit aims to make Dell and Dell Financial Services pay restitution to consumers who have been affected by these service shortcomings on the part of Dell. The suit also seeks to make certain that Dell and DFS do not “engage in deceptive, illegal, and fraudulent practices in the future.”
Dell is the No. 2 computer distributor in the US. If true, the New York allegations are a startling turnaround for a company that once prided itself on customer support and satisfaction.