New York Attorney General Accuses Dell with Fraud

On Tuesday, Andrew Cuomo, New York Attorney General, accused Dell Inc. company and Dell Financial Services unit of fraud, false advertising and deceptive business practices. According to the lawsuit filed by Andrew Cuomo, Dell has put forth the rates for some customers, without their knowledge, after they've claimed the offer was zero percent financing.

Bob Pearson, Dell spokesman, dismissed the accusations through a written statement:

"We are confident that our practices will be found to be fair and appropriate...Our customers are our top priority at Dell. While even one dissatisfied

customer is too many, the allegations in the AG's filing are based upon a small fraction of Dell's consumer transactions in New York."

According to Cuomo, things are a bit different. Just a bit, not much different. He claims that so far, he has received more than 700 complaints against Dell, but that's not all, as they keep on coming. The lawsuit also claims that Dell has deceived the customers by claiming that it sells onsite computer repair plans but failed to deliver, at times even demanding the customers to disassemble their computers. The attorney general has stated in the lawsuit that clients who "purchase Dell's products often find that many of the benefits and inducements featured in Dell's advertisements are illusory." If Dell is found guilty of the accusations brought, then it would have to pay costs and penalties to the state, among the damages to the defrauded customers.

Laura Conigliaro, analyst with Goldman Sachs, claims that actually Dell has been taking significant measures for improving its customers service.

"The suggestion that Dell set out to intentionally deceive consumers, as the lawsuit contends, does not ring true with the reality that Dell has been in the process of adding resources to its services capability," said Conigliaro.

Dell is said to have been investing $100 million lately to improve customer service, and that it also eliminated its complex rebate system in favor of a more predictable one.