NEW YORK, Jan 16 (Reuters) – Sterling Jewelers Inc, whose brands include Kay Jewelers and Jared, agreed to pay $ 11 million in fines to settle US and New York regulatory authorities' fees for signing up consumers for credit cards and credit insurance without permission.
The settlement announced on Wednesday invites Sterling, a unit of Signet Jewelers Ltd, to pay $ 10 million to the US Consumer Financial Protection Bureau and $ 1 million to the office of the New York Attorney General Letitia James. 19659002] Sterling did not admit or deny wrongdoing.
James said that Sterling forced employees to sign up for customers in store-branded credit cards by setting quotas and binding the results of the results and paying for whether the quotas were met.
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She said Akron, Ohio-based company also tricked consumers into providing personal information to sign up for what they thought were "rewards" or discount programs, only to use the information to submit credit card applications.
Even when consumers wanted credit cards, Sterling misled some to believe that they got "no interest" funding, as there were actually monthly financing fees, James added.
"This settlement keeps the company accountable for its negligence and ensures that no more consumers are deceived," James said.
Sterling has about 130 stores in New York, James added.
Signet revealed the investigations in December 2017. It will recognize a $ 11 million charge before the tax in the quarter ending February 2, 2019.
Signet said in a statement that it disagreed with allegations but fully cooperated out with the probes and "look forward to continuing to give our customers access to appropriate credit facilities."
The company said it is the largest specialty jewelry retailer in the United States, the United Kingdom and Canada, with about 3,600 stores, including the Zales brand.
Signet shares rose 45 cents to $ 34.27 in morning trading. (Reporting Jonathan Stempel in New York, editing Susan Thomas and Phil Berlowitz)