Judge Freezes Assets Of On-line Home Furnishing Retailer

Attorney General Spitzer today announced that his office has obtained a restraining order against an on-line furniture and home furnishing retailer based in Western New York and Ontario, Canada.

Justice Frederick J. Marshall of State Supreme Court in Erie County signed an order temporarily freezing the assets of BeaverHome.com, a Niagara Falls-based company, and barring the firm from destroying or disposing of any business records. Also filed today was a lawsuit by the State charging BeaverHome.com with repeated and persistent fraud and deceptive business practices.

"On-line retailing depends on consumer confidence that promises will be fulfilled," Spitzer said. "This firm has engaged in a persistent pattern of lies, both to its customers and to law enforcement, requiring my office to take aggressive action before any additional consumers are injured."

Spitzer's office alleges that BeaverHome.com continued to defraud consumers even after settling a case earlier this year and promising reforms. According to the legal papers, Spitzer's office is seeking a court order barring BeaverHome.com from further fraudulent and illegal acts and from operating as a home furnishing business in New York State unless it posts a $1 million performance bond.

In January of this year, Spitzer's office entered into an out-of-court settlement with BeaverHome.com to reform its business practices. The office had received over 30 complaints from purchasers of merchandise from the retailer. Most consumers complained that their ordered merchandise never arrived and their attempts to get refunds went unresolved. Those consumers who had actually received refunds from BeaverHome.com soon discovered that the company's check bounced.

In addition to obtaining nearly $90,000 in refunds for consumers through mediation, Spitzer's settlement earlier this year required the company to institute various reforms such as:
  • confirmation of delivery dates in writing or by e-mail;
  • procedures for advising consumers of any shipping delays and offering the consumers the option of cancelling their order and obtaining a refund, choosing a different shipping date, or selecting substitute merchandise;
  • full refunds or exchanges when the wrong merchandise was shipped or damaged; and
  • refunds within 30 days and an additional $200 plus bank fees to any customer whose refund check was returned for insufficient funds.
Since the settlement earlier this year, Spitzer's office has received an additional 20 complaints from BeaverHome.com customers indicating that the company failed to implement the promised reforms and, in fact, was continuing to defraud its customers with false promises and bad checks. The consumer complaints received after the settlement consist of claims for refunds totaling over $134,000.

BeaverHome.com has been selling home furnishings such as hardwood floors, kitchen cabinets, oriental rugs, and leather furniture since at least 1996. In 2000, it opened a showroom in Niagara Falls.

Individuals wishing to file a complaint against BeaverHome.com should contact the Attorney General's consumer help line at (800) 771-7755.

This case is being handled by Assistant Attorney General James Morrissey of the Buffalo Regional Office.
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