Nationwide Settles Bait-and-Switch Case

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Nationwide Computers and Electronics agreed yesterday to pay $250,000 and alter its business practices to settle allegations brought by the New Jersey State Division of Consumer Affairs that the Edison, N.J.-based chain used bait-and-switch advertising tactics and sold used products as new.

Nationwide did not have to admit guilt in agreeing to settle the case, which was brought in June 1998. Joseph Cohen, Nationwide's president, called the allegations false, but said settling the issue out of court would prove less expensive and time consuming then joining in a legal battle with the state.

In addition to paying the fine, Nationwide agreed to: clearly state the terms and conditions of its no and free interest offers in ads, refrain from requiring customers to possess a copy of a printed ad in order to receive the advertised price and inform consumers in ads that they are entitled to a written copy of Nationwide's refund/exchange policy. The chain must also resolve all outstanding customer complaints or the issue will be referred to the Consumer Affairs Division's Alternate Dispute Resolution Unit.

The $250,000 was levied to pay for administrative and other costs associated with the matter.

"In addition to being unlawful, bait-and-switch practices are unfair to customers and to other retailers in the electronics business who advertise faithfully, said N.J. attorney general John Farmer.


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