Attorney General James Announces Court Decision Allowing Continuation Of Multistate Fraud Case Against Harris Jewelry  

Albany, New York, USA at the New York State Capitol
Albany, New York, USA at the New York State Capitol
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WATERTOWN—Attorney General Letitia James today announced the court decision to allow the multistate, multi-year lawsuit against Harris Jewelry to proceed. The lawsuit, filed in October 2018, alleges that the retailer/financier specifically targeted servicemembers with their illegal and fraudulent business practices.   

The Court declined Harris Jewelry’s motion to dismiss the case in its entirety, and ruled that claims against Harris Jewelry for statutory and common law fraud and violations of the State’s charitable co-venturing laws may proceed. The court additionally dismissed claims related to interest rates and general business law, and preserved the Attorney General’s claims of wrongdoing against the individual business principals, board members, Consumer Adjustment Corp., and the company’s out-of-state related corporations.  

“The Court’s decision to move forward with this lawsuit allows my office to continue in our commitment to protect the financial welfare of servicemembers and hold those seeking to defraud them accountable,” said Attorney General Letitia James. “My office will not back down from its efforts to vigorously protect our military.” 

Owners Susan Harris, Beverly Harris, and Sandi Harris-Pleeter were sued individually along with board members/executives John Zimmermann, David Malane, and Richard Baum, in addition to Consumer Growth Partners, a private equity and investment firm led by Baum. 

Harris Jewelry, which is headquartered in Hauppauge, New York, has a retail store in Watertown, New York along with several other locations across the country, all strategically situated next to military bases for the express purpose of selling over-priced jewelry to servicemembers with in-house credit, as alleged by the Attorney General. The complaint includes allegations, for example, that the oft-sold Mother’s Medal of Honor is purchased at wholesale by Harris for under $78, but is sold as “quality” jewelry with store financing for $799 plus interest, over 10-times the wholesale amount. The lawsuit further alleges that servicemembers are defrauded by false representations about the benefits of Harris Jewelry’s proprietary financing and jewelry quality while force-placing warranty add-ons and failing to properly administer a charitable co-venture.

The lawsuit seeks a permanent injunction, restitution for defrauded consumers, and financial penalties.