March 7, 2021
LuLaRoe

LuLaRoe Got fined $95K for “unfair & deceptive” Buy Back Policy

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Welcome to some news where I found out that LuLaRoe got fined for $95K.

An investigation by the Pennsylvania Attorney General has discovered LuLaRoe’s Buy Back Policy to be “unfair and deceptive”.

The AG charges LuLaRoe’s strategic policies are infringing upon Pennsylvania Consumer Protection Law.

Subsequent to getting nineteen consumer complaints, seventeen of which pertained to refund complaints, the Pennsylvania AG started an investigation concerning LuLaRoe’s business practices.

LuLaRoe Clothings

The investigation found that LuLaRoe “lured” consumers into its MLM opportunity, with confirmations made through its Buy Back Policy..

LuLaRoe lures Consultants into agreeing to front the required $5,590 to purchase the requisite amount of LuLaRoe clothing to become a Consultant.

To remain “active” … Consultants … are continually encouraged to buy more LuLaRoe goods.

In at least some instances, Consultants brought into LuLaRoe’s business premised upon LuLaRoe’s misrepresentation that they would (be) able to get a full and/or partial refund on all products not sold.

According to figures got through the AG’s investigation, since starting its Buy Back Policy LuLaRoe has received

at least 1725 refund requests … which generally ranged from $3000 to $5000, and in total exceeded $9,000,000.

The investigation found that LuLaRoe had

engaged in … unfair and deceptive business practices pertaining to the refund claim process.

In many instances there has been a significant and unreasonable delay of time from the date the Consultants requested a refund and the time their refund check was sent.

The AG claims that relating explicitly to Pennsylvania, LuLaRoe owed 52 Consultants overdue refunds.

In light of LuLaRoe’s representation through the Buy Back Policy and “no risk” opportunity, it is unfair and deceptive for LuLaRoe … to timely process Consultant refund claims.

It is unfair and deceptive for a business to represent a refund policy to induce Consultants to extend significant capital and then have a slow pace buy-back process resulting in many Consultants being harmed by not having significant capital returned … within a reasonable amount of time.

In a documented Assurance of Voluntary Compliance, the Pennsylvania AG notes LuLaRoe “fully cooperated” with his investigation.

Because of the investigation, LuLaRoe has spoken to the AG’s Office that

  1. it has just stretched out impressive assets to ensure that cases made under the Buy Back Policy were timely processed; and
  2. authentic refund claims will keep on being completely handled within 90 days of the receipt of apparel returned by the Consultant, including the instalment for any cash owed for the mentioned refund.

LuLaRoe debates claimed infringement of Pennsylvania Consumer Protection Law, venturing to such an extreme as to contest the proof set forth by the AG.

Regardless LuLaRoe has agreed to halt from violating Pennsylvania Consumer Law.

The agreement form part of a settlement reached between LuLaRoe and the AG’s Office.

In addition to the refund issue, there’s also this fascinating affirmative relief clause;

LuLaRoe shall not, in the future, engage in conduct which violates the Consumer Protection Law, specifically including … representing that goods or services have sponsorship, approval, characteristics, ingredients, uses, benefits or quantities that they do not have or that a person has sponsorship, approval, status, affiliation or connection that he does not have.

“Goods and services” refers to LuLaRoe’s clothing, proposing claims were being made about LuLaRoe’s items that are false. The AG’s settlement report doesn’t go into a particulars.

Money related help will be taken care of by method of a $95,950 civil penalty and $14,050 to cover the AG’s Office’s enforcement and legal costs.

Looking forward, Consultants in Pennsylvania who’ve placed in a buy back policy refund request and haven’t been paid in 90 days, have the choice of seeking after the issue through the AG’s Office.

According to an October ninth press-release, the Pennsylvania AG’s Office requests

consumers who believe they continue to be victimized by LuLaRoe should file a complaint at www.attorneygeneral.gov or email [email protected]

The AG’s Office claims LuLaRoe has more than 6700 Consultants in Pennsylvania.

I suppose in the event that LuLaRoe are occupied with refund antics in Pennsylvania, at that point they are going on over the US.

This is likely something the FTC should investigate, considering we’re talking over $9 million in deferred Buy Back Policy refunds.

Anyway that’s all I got for the news on LuLaRoe….

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