Blue Hippo leaves consumers feeling blue

Seven On Your Side
April 24, 2009 9:19:50 PM PDT
The company promises to send you a brand new computer after you have made layaway payments to them. But consumers were disappointed when the computers didn't show up as they expected. And now, consumer authorities have gotten involved. Blue Hippo's commercial touts they're the place where "anyone can get a brand new, brand name computer regardless of credit."

Martine Cannon saw the commercial and thought it would be simple. She says she was told she would get a computer after only a few payments, "After the 13th week, I would receive the computer."

Nicole Downie says she got a similar promise, "After 13 weeks of payments they would ship the computer to your home."

Both women gave Blue Hippo permission to deduct weekly payments from their checking accounts.

"I actually continued up until 39 weeks which made it about November and still nothing, nothing," said Martine. Nicole says she also received nothing from the online computer store.

And when the computers still didn't arrive, they both stopped paying. "I asked them, you know, to send the money back, they told me that there was no refund," said Nicole.

Martine tried to talk to customer service. And when she got nowhere 7 On Your Side's Tappy Phillips tried.

"These people have paid thousand of dollars to you and received nothing. So it's a big problem," said Tappy.

It turns out it's against federal law for a retailer not to deliver on promises.

Now, Blue Hippo has caught the eye of federal authorities.

"Our mail order rule requires that if you promise consumers a shipment by a specified date, you're supposed to do that," said Deborah Marrone of the U.S. Federal Trade Commission.

Enough unhappy customers complained to the Federal Trade Commission that Blue Hippo, without admitting wrongdoing, agreed to pay back up to $5 million to customers and cease any misrepresentations in their marketing.

"There were possible violations of the mail-order rule, the electronic fund transfer act and the truth in lending act," said the FTC contact.

So what is Blue Hippo offering now? We called one of their salesmen. And found they still make the same promise.

"If I authorize you to take money out of my checking account, in 13 weeks, I'll get the computer."

They offered me a Dell laptop for $1900. Not such a great deal, a comparable one on the Dell website sold for less than half that.

This week Blue Hippo was fined $10,000 by a judge hearing the Federal Trade Commission complaint. Blue Hippo did not respond to our request for a comment.


Produced by: Steve Livingstone

STORY BY: Eyewitness News reporter Tappy Phillips