A $10.5 million partial settlement against the retailer Curacao will see the company providing $10 million in debt relief to its consumers, as well as $500,000 in debt forgiveness, but both the company and the state say the settlement is a win.
California Attorney General Xavier Becerra said that the settlement was a significant win for the mostly low-income, immigrant Latino customers the chain markets itself to.
“Curacao claimed to be part of Southern California’s Latino community,” Becerra said. “It then proceeded to defraud low-income individuals, Spanish speakers and immigrants with little or no experience entering into long-term financing contracts. This company fleeced its own loyal customers who simply walked into its department store looking for a decent deal.”
The partial settlement holds the company accountable for what they did, Becerra said.
“Curacao will now have to pay for its bad practices and obey a court order that will make the company treat its customers fairly,” he said.
Ariela Nerubay, EVP I chief marketing officer, told the Southern California Record that the company did not admit to any wrongdoing in the settlement. Ultimately, the choice to settle was one of picking the least expensive option between paying attorneys to continue fighting and paying for a settlement, and the company is simply happy to have the issue resolved out of court.
“Fighting with the government is not a journey that is easy to do, especially because they have so many resources, and we don’t,” Nerubay said. “We’re a small, privately-owned company, and the attorney general has been fighting with us for four years, without the ability to win, because they didn’t.”
The settlement comes in the form of credits to customer accounts, and ultimately Curacao prefers to put that money into their customer’s accounts than to continue putting it into the pockets of lawyers, she said.