Curacao to pay $10.5 million after charges it cheated Latino customers

SOUTH GATE — Los Angeles-based retailer Curacao has agreed to pay $10.5 million as part of a settlement for business practices that unlawfully harmed primarily Spanish-speaking immigrant consumers and their families.

The settlement resolves multiple allegations included in a 2017 lawsuit filed by the Attorney General against Adir International, the parent company of Curacao, and its owner Ron Azarkman. 

The lawsuit alleged that Curacao lured in customers by advertising low prices and easy credit, then informed those consumers they could only buy at the advertised price after purchasing ancillary accessories, warranties, or installation services. 

In other cases, Curacao added items to payment contracts without the customers’ knowledge.

State investigators spent hundreds of hours interviewing dozens of Curacao’s affected customers, nearly all of whom are Latino immigrants with low incomes who communicate primarily in Spanish, to collect and provide evidence to support the Attorney General’s lawsuit and eventual settlement.

“Immigrants in Los Angeles County, particularly those whose primary language is something other than English, face significant challenges every day. The least they can expect is to be treated fairly and lawfully by businesses that serve and market to them in their preferred language,” said Rafael Carbajal, director of Los Angeles County Department of Consumer and Business Affairs (DCBA). “We are pleased that the Attorney General has secured relief for consumers who need it most, and that we were able to play our part to help keep the marketplace fair for both consumers and businesses which properly follow the law.”

As part of the settlement, Curacao must provide $10 million in debt relief for consumers who were harmed by their conduct. The settlement also includes additional debt forgiveness for customers who are still paying Curacao for unlawful small claims judgments, plus $500,000 in civil penalties. 

The settlement also includes injunctive terms requiring Curacao to comply with California law and treat its customers fairly and ethically. Those terms include:

Curacao stores will prominently display a consumers’ bill of rights;

Curacao must sell items as they are advertised, and must provide additional disclosures in its advertising;

Senior management will review Curacao’s advertising for compliance with the court judgment;

Curacao must fully disclose all material contract terms before asking customers to sign contracts;

Curacao must provide customers with a contract in their language before asking them to sign;

Debt collection efforts will be limited to one phone communication per day with delinquent consumers;

Curacao will stop debt collection activities against, and clear the credit records for, consumers who had default judgments entered against them in unlawful small claims actions;

A corporate ethics expert will help Curacao create and maintain an effective sales incentive, compliance, and ethics program that incentivizes lawful behavior, and that includes annual ethical culture surveys and assessments; and

Curacao will regularly report its compliance to the Attorney General for several years and provide access to its records for review.