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BlueHippo Funding

From Alfawiki
BlueHippo Funding, LLC
IndustryFinancial services
FounderJoseph Rensin
Products
  • Personal computers
  • Flat-screen televisions
  • Electronics
ServicesInstallment credit

BlueHippo Funding, LLC operated in the United States as an installment credit provider established by Joseph Rensin. The company specialized in offering personal computers, flat-screen TVs, and various electronic devices to consumers with low credit scores. On November 25, 2009, BlueHippo sought Chapter 11 bankruptcy protection, attributing its financial difficulties to complications with its banking partner. However, by December 9, 2009, following the freezing of funds by its payment processor and the denial of a petition to release those funds, the company transitioned to filing for Chapter 7 bankruptcy. Its toll-free customer service line and website have since been discontinued.

Throughout its operation, BlueHippo encountered a significant number of grievances registered with the Better Business Bureau, which issued a consumer warning within eight months after the company's inception. The firm’s main offering was a personal computer system marketed through an installment payment plan that purportedly helped customers establish a "short credit history."

Multiple investigations into BlueHippo’s business practices were conducted concerning allegations of consumer fraud. In April 2008, the company reached a settlement with the Federal Trade Commission (FTC) agreeing to reimburse customers up to $5 million. Despite collecting over $15 million since that time, the FTC reported that BlueHippo delivered "at most a single computer" before enforcement actions resumed in April 2009. The company repeatedly neglected to submit mandatory reports to the FTC and was penalized by the court. In November 2009, the FTC pursued a contempt order against BlueHippo due to ongoing noncompliance.

Criticisms and investigations

The Federal Trade Commission (FTC) reviewed an extensive volume of complaints—totaling approximately 8,000 pages—and initiated an inquiry into BlueHippo’s operations. In February 2008, a settlement was reached requiring the company to pay up to $5 million to resolve allegations against it. By April 2009, a federal court held BlueHippo in contempt for failing to provide required documentation to the FTC.

In 2007, the Maryland Attorney General settled claims with BlueHippo, resulting in an agreement for the company to compensate consumers who either overpaid or did not receive their products. Florida’s Attorney General Bill McCollum characterized BlueHippo’s business methods as "very deceptive." The Tennessee Attorney General filed a civil lawsuit accusing the company of deceptive conduct, sought an injunction mandating clearer advertising disclosures, and froze $2.5 million in assets. Legal proceedings were also initiated by authorities in West Virginia.

A class action lawsuit was initiated in Oklahoma in January 2007 and subsequently moved to federal court jurisdiction. As of August 2009, the Better Business Bureau (BBB) had accumulated over 3,950 complaints from across the country and assigned BlueHippo an "unsatisfactory" rating due to persistent problems and unresolved customer issues.

In mid-2006, BlueHippo implemented a refund policy allowing full refunds within seven days of purchase; cancellations beyond this timeframe were eligible only for store credit redeemable on its website. Nevertheless, complaints increased again later that year as customers reported delays in refunds and product deliveries.

Following its Chapter 7 bankruptcy filing in 2009, BlueHippo agreed to a $5 million reimbursement arrangement and updated its operational procedures amid accusations of engaging in a fraudulent electronic financing scheme. In 2016, the company was ordered to pay $13.4 million in restitution to customers who had been defrauded.

External links

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