Remember when Dell got nailed by the State Of New York for deceptive business practices related to financing promotions for its computers and the technical support that they offered? Today, the State Of New York served up a $4 million bill to Dell:
Along with the $4 million in restitution, penalties and fees, the settlement also requires Dell to make sweeping changes to its advertising, sales and financing practices. Among other things, Dell will be required to advise consumers before they purchase an “at home” or “on site” service contract that they may be required to engage in diagnostic activity over the telephone that includes consumers themselves opening their computers to access internal components. The settlement also requires Dell to disclose in its advertisements for promotional financing the estimated percentage of consumers who will actually qualify for the promotion.
Okay, this sounds good. Dell does something bad, the state punishes them. Everybody is happy. Right?
Wrong.
If you do the math, this fine is a rounding error for Dell. They pulled in $472 million last quarter, so this is just a mere 1% of their profits at most. So while Attorney General Andrew M. Cuomo will say that this is a great victory for consumers, it really doesn’t do much to dissuade this sort of behavior.