Ken Paxton

Monday, January 12, 2009

Attorney General Abbott Reaches Agreement With Dell

AUSTIN Texas Attorney General Greg Abbott today reached an agreement with Dell, Inc., that will lead to improved disclosures for customers who obtain financing through Dell Financial Services, L.P. Under today’s agreement, Dell will also change Dell Preferred Account enrollment policies, reform its warranty and rebate practices, and provide restitution to certain eligible customers.

Dell’s marketing materials encouraged customers to open Dell Preferred Accounts by promising special promotional interest rates, including no interest for three months. However, Preferred Accounts customers were not guaranteed to qualify for the promotional interest rates. As a result, some Preferred Accounts holders were charged higher interest rates than they anticipated.

According to customer complaints, Dell also failed to provide rebates within the promised timeframe. Additionally, some customers complained about Dell’s failure to fulfill warranty obligations, and said the company did not meet promised next day on-site repair or technical service agreements.

Today’s agreement resolves concerns over Dell’s advertising of special promotions for the Dell Preferred Account and other complaints facing Dell. In the future, Dell must clearly disclose the conditional nature of promotional offers and interest rates. Dell also is required to change its warranty-claims procedures, complete warranty service within 30 days and ensure customers are aware of their obligations to troubleshoot problems before receiving service. In addition, Dell must honor next day service promises.

Finally, Dell agreed to process rebates within 30 days of receiving completed rebate paperwork, if no other timeframe is provided to customers. Dell admitted no wrongdoing.

Texans who believe they incurred additional costs on or after April 1, 2005, because of the practices described above may be eligible for reimbursement under the agreement. Texas consumers have until April 13, 2009 to complete a restitution claim form, which can be found at or by calling (800) 252-8011. Dell has agreed to contribute $162,500 into a restitution fund for these claims and is reimbursing the state $62,500 for its attorneys’ fees and costs.

Texas consumers who believe they have encountered deceptive trade practices can contact the Office of the Attorney General at (800) 252-8011 or file a complaint online at