CHARLESTON - A yearlong battle between Attorney General Darrell McGraw and Hague Quality Water ended in a settlement in which Hague agreed to end private label credit card financing by its home dealers.
Hague, a manufacturer and distributor of water treatment systems, also agreed to make sure its dealers' sales practices comply with West Virginia law, and the company paid West Virginia $10,000 to be used for consumer refunds and other consumer education purposes.
"I am pleased that Hague has now taken the necessary steps to ensure that its dealers will end the objectionable practice of financing sales of expensive water treatment systems on private label credit cards," McGraw said in a news release. "This action will prevent dealers from disguising the true cost of financing by placing expensive products on high-interest credit cards with deceptively low monthly payments."
McGraw's release said the practice of private label credit cards, sometimes known as bogus open end credit, involves consumers being led to believe a purchase can be put on credit with low monthly payments when the payments only cover the interest. This can leave high-interest debt for many people.
The practice of selling products exclusively in door-to-door sales through a dealer network in common in the industry, and McGraw's office says it has been trying to combat "deceptive sales practices" and has settlements with Aquion Partners, Culligan International and Kinetico.