ATLANTA, GA – Attorney General Chris Carr has joined a multistate settlement agreement recovering $34.2 million for more than 46,000 U.S. servicemembers and veterans who were deceived and defrauded by national jewelry retailer Harris Jewelry.

“We will not allow Georgia’s military families to be taken advantage of, and any company that seeks to do so will face the consequences,” said Carr.

“This settlement provides much-needed relief to the service men and women who fell victim to Harris Jewelry’s deceptive acts. As we mark Military Consumer Protection Month, we hope this serves as a reminder that this type of unlawful behavior will not be tolerated in our state.”

The multistate settlement agreement requires that Harris Jewelry stop collecting $21,307,229 in outstanding debt that is held by 13,426 servicemembers, which includes $1,935,231.56 in outstanding debt for 1,206 Georgia servicemembers. In addition, the company must provide up to $12,872,493 in refunds to 46,204 servicemembers who paid for protection plans, including $978,097.81 for 3,711 Georgia servicemembers. Harris Jewelry is also required to vacate judgments against 112 consumers totaling $115,335.64 and delete any negative credit entries reported to consumer reporting agencies.

Harris Jewelry, headquartered in Hauppauge, New York, operated retail stores near and on military bases around the country. Their business model was designed to primarily target and service people in the military. A multistate investigation found that local servicemembers were enticed into retail stores through a marketing scheme, dubbed “Operation Teddy Bear,” in which Harris Jewelry advertised teddy bears in military uniforms with promises of charitable donations. The investigation found that no legal contract was actually signed between Harris Jewelry and the charity it claimed to support. Moreover, consumers were often given varying and conflicting information about the amount donated to the charity. Sometimes they were told all the proceeds would be donated, and other times they were told only a portion would be donated.

In addition, Harris Jewelry offered servicemembers predatory lending contracts that were marketed to them as a way to build or improve their credit scores. The credit advanced to servicemembers through the Harris Program was not based on a consumer’s credit score, potential income or other legitimate factors that banks consider. Rather, it was based on a servicemember’s branch of service, the amount of time they had remaining on their term of enlistment, and the category of merchandise they purchased. Servicemembers were led to believe that they were investing in the Harris Program and the jewelry they purchased was a gift from Harris Jewelry.

The jewelry itself was significantly overpriced and poor quality. The investigation found that the company dramatically inflated the retail price of its products, generally by multiplying its wholesale cost by six or seven times, and in some cases 10 times the wholesale cost. For example, Harris Jewelry purchased its popular Mother’s Medal of Honor at $77.70 but sold it at $799. The jewelry was not worth the price and consumers often reported stones falling out, chains breaking and the finish fading.

Harris offered servicemembers protection plans on the jewelry, which they claimed were optional but were added to nearly all eligible transactions without the servicemember’s knowledge. The costs of the protection plans ranged from $39.99 to $349.99, depending on the retail price of the item. In some instances, the cost of the protection plan exceeded the wholesale cost Harris paid for the item. Protection plans were added to a consumer’s retail installment contract as a routine practice without disclosure to the consumer.

With the inflated purchase price, protection plans, taxes, shipping and handling fees, teddy bears and other fees, servicemembers were charged more than they were initially told. Using the $799 Mother’s Medal of Honor as an example, servicemembers were charged $79.99 for a protection plan, taxes and other fees, bringing the total principal cost to $974.31. At a 14.99 percent interest rate over a 10-month period, the total amount paid by a servicemember ended up being $1,039.26 for the Mother’s Medal of Honor.

According to the consent order, Harris Jewelry violated the FTC Act, the Truth in Lending Act, the Electronic Fund Transfer Act, the Military Lending Act, the Holder Rule, and state laws in connection with jewelry sales and financing to members of the military.

Specifically, the states and the FTC allege that Harris Jewelry:

  • Made false or unsubstantiated claims that financing jewelry purchases through the company would result in higher credit scores: The company told servicemembers that they would achieve a significant improvement in their credit score by entering into a retail installment contract with Harris Jewelry when, in fact, that was not true in many instances.
  • Misrepresented that the protection plan was required to finance purchases: In connection with the sale of jewelry and military-themed gifts, Harris Jewelry offered a protection plan that covered ring and watch sizing, battery replacements and repairs. In several instances, the company gave the false impression that the protection plan was not optional or was required to finance the purchase when it was, in fact, optional.
  • Failed to provide written disclosures and meet authorization requirements for contracts as required by law: Harris Jewelry failed to include written disclosures in its retail installment contracts as required by the Truth in Lending Act and Military Lending Act and meet authorization requirements as required by the Electronic Fund Transfer Act. Its internet and print ads also failed to include the required Truth in Lending disclosure. The company also failed to provide written notice as required by the FTC’s Holder Rule in its contracts and failed to make oral disclosures at the time of sale as required by the Military Lending Act.

Servicemembers and veterans who entered into a predatory financing loan with Harris Jewelry between January 2014 and July 2022 will be eligible for restitution to the extent they paid for warranties. An independent monitor will be installed to oversee the relief and contact eligible servicemembers and veterans. Eligible servicemembers and veterans will receive an email and letter in the mail notifying them of this agreement and their eligibility. Servicemembers will then have to claim their restitution.

Joining Carr in filing this agreement are the FTC and the attorneys general of California, Connecticut, Delaware, Florida, Hawaii, Idaho, Illinois, Iowa, Kansas, Louisiana, Maryland, Nevada, New York, North Carolina, Pennsylvania, Virginia and Washington.

Military Consumer Protection Guide

The Attorney General’s Consumer Protection Division offers the Georgia Military Consumer Protection Guide to help active and former servicemembers better understand their rights as consumers and how to protect themselves from common scams. Georgians can download the guide here.

The guide covers a range of topics, including buying a car, housing and renter’s rights, insurance, the Military Lending Act, budgeting and personal finance, debt collection, identity theft, scams and fraud, and the GI Bill.

Georgia servicemembers who think they may have fallen victim to a scam or deceptive business practices can contact the Attorney General’s Consumer Protection Division by calling (404) 651-8600 or by filing an online complaint here.


Communications Director Kara Richardson