US FTC accuses reseller of offering bogus rebates

The U.S. Federal Trade Commission has filed a lawsuit against electronics reseller Wintergreen Systems, alleging that the company didn't honor rebates it offered for some items and took as long as two years to fulfill other rebates.

Wintergreen and parent company Market Development Specialists, along with owner John Levy, failed to pay rebates due to thousands of U.S. consumers within the time promised, with some customers receiving no rebates at all, the FTC said in a complaint filed Monday, in U.S. District Court for the Northern District of California.

The FTC asked the court to bar Levy and his companies from participating in any more rebate programs and to impose a suspended judgment of US$330,000. If Levy has misrepresented his ability to pay the fine, the court could require he pay the entire amount under the FTC's request.

Levy had an April 2006 agreement with the state of Indiana to improve its rebate services. That agreement required his company to honor rebates within eight weeks, according to the FTC's court complaint.

Wintergreen Systems did not return an e-mail message asking for comment on the FTC complaint. A call to Wintergreen's rebate line resulted in a message saying the line had high traffic and people with questions should send an e-mail.

Wintergreen, on its Web site, said it is "committed to bringing customers the best values possible. We buy in bulk to get the lowest prices and take advantage of our super-efficient facilities to bring you the best value in the Industry."

The company is a certified partner of Microsoft, Intel and Advanced Micro Devices, the Web site says.

Wintergreen offered rebates ranging from $20 to $150 on a variety of electronic products, including computer monitors and portable DVD players, the FTC said. Wintergreen offered the products and rebates through several retailers, including Office Depot, PC Connection, Buy.com, PCMall and Woot.com, the agency said.

"Thousands of consumers never received a rebate check from defendants," the FTC said in its complaint. "Moreover, those minority of consumers who actually received a rebate check from defendants experienced substantial delays, including delays often 10 weeks or longer."

The FTC's proposed settlement would prohibit the defendants from making any misrepresentations regarding any "bonus" or rebate. A strongly worded settlement is needed because of Levy's past problems with rebates, the agency said.

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