Ron Schenone

BlueHippo Allegations Continue From BBB

Posted by on Jul 16, 2007 | 42 Comments

I was reading an article from the Kansas City Star in which the BBB [Better Business Bureau] is alleging that BlueHippo has been receiving many complaints about its business practices:

“high pressure sales practice, non-delivery of promised merchandise, and unwillingness to provide a refund or exchange,”

I recalled seeing the BlueHippo advertisements on TV and had thought to myself that the advertising seemed geared to those with no credit or bad credit. I also recalled thinking that the pricing seemed a little steep at the time. So I decided to take a look at what BlueHippo was offering and checked out the cost of its least expensive laptop computer system, which starts at $39.95 a week. That is no typo, folks. It is a week, not a month.

This is what I found on the BlueHippo site:

Your Laptop 2007 B
You pay just $39.99 a week.
Your total cost will be $2,178.48.
Since we don’t check your credit, we do ask that you build a credit history with us by paying a $99.00 initial fee, followed by 52 weeks of consecutive layaway payments of $39.99. Depending upon the product, after 6 weeks we can then offer to finance the balance of your purchase price, order your computer, and have it shipped directly to your home via UPS or FedEx. It’s that simple!

So what kind of laptop system do you get for $$2,178.48 ?

  • AMD Mobile Sempron 3500+ 1.8 Ghz processor
  • 512MB Memory
  • 60GB Hard Drive
  • 8x DVD-RW Combo drive
  • 15.4 inch WXVGA LCD screen
  • Free: Digital Camera (with paid order)
  • Free: Color Printer (with paid order)

I can see why consumers are complaining. That seems just a little high to me. OK. It is almost double what you would pay for a laptop with the same configurations even throwing in a digital camera and printer. Also note that no brand names are mentioned.

Be careful out there.

Comments welcome.

Kansas City Star article here.

BlueHippo site here.

[tags]bluehippo, allegations, BBB[/tags]

  • marc klink

    Remember the words of P.T. Barnum and W.C. Fields? [except that P.T. is credited with something he did not say] The quote was supposed to be “There’s a sucker born every minute, and two to take him!”

    Most people could do much better in life if only a small amount of thought was put forth first.

    I’m actually surprised that someone has not exposed the fact that BlueHippo is a form of loansharking. Viggerish the mafia could be proud of.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hi Marc,
    I think you were kind using the word “loansharking”. It is more like theft plain and simple! :-)
    Ron

  • TucsonMatt

    Well, this is obviously aimed at people who have no or bad credit and can’t get a computer any other way. They think.

    By the time they pay the initial fee and wait 6 weeks, they will have paid about 340.00 and will have received nothing.

    I figure that by the time 6 weeks has gone by and they determine if they will finance you and order your computer and it gets shipped, you will have at least another week or two invested or another 40.00 to 80.00, so you will have at a minimum 380.00 you have spent.

    I found a laptop at eCost with virtually the same specs except a Dual Layer DVD-RW drive and built in wireless for 450.00. So, if people just saved the money, they would end up being able to afford the laptop on their own in just a couple more weeks.

    The fact that they don’t do the research and find this out for themselves is why they get suckered into deals with places like BlueHippo and probably why they have no or bad credit!!

  • anonymous

    PeoplePC used to be that kind of outfit. Now they’re an ISP.

    These places are quite numerous, they crop up like weeds and disappear almost as quickly. I’d like to say that most people are too smart to fall for these scams, but the sad truth is most people are complete morons. If it weren’t true these places wouldn’t exist.

  • Greg

    Well, certainly no bargain, but if you have lousy credit, this might be your only option.

    Something else to consider. Were you aware people with lousy credit typically pay a higher percentage rate on car loans, etc.? Where’s the outrage there?

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello TusconMatt,
    I like the idea of saving to buy. Paying BH $40 a week or saving the $40 a week yourself than applying it towards the purchase makes more sense.

    Hi anonymous,
    Same with spam. If it weren’t for the dummies who buy the Viagra online, spam would die over night.

    Greg,
    Could point.

    Thanks for the comments everyone,
    Ron

  • Fred Fisher

    I was, for several years, in the furniture & appliance ” Rent to Own” business. This is basically the same kind of thing. Yes, the prices charged are very high. The reasons for that are as follows.

    One. No credit is required, which leaves the rental agent no way to recover a loss legally except to follow the delinqent around asking for the merchandise back.

    Two. 90% of all returned or recovered merchandise is broken or completely trashed & now unusable.

    Three. As much as 30% of customers will skip with the agents merchandise.

    Therefore an agent must recover his cost of the merchandise in just 3 months to be able to keep buying more merchandise to rent.

    All terms are laid out in advance & no one is ever forced to use this option to get things. The prices charged are governed by the above info so , Yes , the prices seem quite high. The agent is GAMBLING from the very start of this kind of operation and customers are paying for the actions of former customers.

    That being said. It seems that this Blue Hippo requires his investment in merchandise paid before he ever gives out any merchandise. I think Blue Hippo is overpriced but in no way is it not doing business in an acceptable manner. Remember, he will give the machine to anyone, despite a previous record of non payment. All prudent businesspeople have insurance of some sort.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello Fred,
    Thanks for sharing your experiences with us. Maybe Rent To Own businesses could do the same thing. Use a kind of layaway plan. Once the item is paid for, you get it. :-)
    Thanks for the comments,
    Ron

  • Rocker452

    This is worse than those rent to own stores. Your basically paying for the computer before they even order it after that all your payments are profit for them. You end up paying over 2 grand for a laptop that cost them maybe 500 at the most and people go for this unbelievable.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Rocker452,
    Thanks for your comments. I agree, it is unbelievable.
    Ron

  • Mike

    “Also note that no brand names are mentioned.”
    “AMD Mobile Sempron 3500+ 1.8 Ghz processor”

    I believe AMD is brand name.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hi Mike,
    AMD is the processor brand.
    Thanks for the comment.
    Ron

  • Phyllis Williams

    I am trying to find out where do I make a complaint and suit against the Blue hippo Funding corporation for non payment on my refund? Can some please help. I am behind on all of my bills. It has been a real enormus burden on my pockets looking for my refund since December 2006. PLEASE HELP!

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello Phyllis,
    You may wish to contact the BBB in your area for assistance.

  • Joe

    The BBB will not “do” anything to help you. All they are is a clearinghouse for complaints. If you file a complaint with the BBB, it ends up on a list of complaints about that company. Other people can see how many open/resolved/etc. complaints there are against that company with the BBB. The BBB will contact the company to encourage them to resolve the complaint. That public list is supposed to encourage the company to resolve complaints. I’m not saying don’t contact the BBB, by all means do, but don’t expect them to do much. If a company intends to screw you, they aren’t going to care what their reputation with the BBB is.

    Contact the Attorney General in your state. In general, they are required to at least take some action on your complaint. From what I’ve heard about this BlueHippo company, they probably have a bunch of complaints already, and your Attorney General will be glad to add another complaintant to the list. You’ll just be more evidence for their case.

  • trfblueeyes

    If you have lousy credit like I did but need a computer to function in daily life, you do what you have to do. You can either save your pennies and pay cash for a pc or use a service like this. The advantage of using BH is that you build your credit. I was actually able to buy a car on my own b/c of my account with BH. No it wasn’t my first choice of pc buying options but it was about the same as going to a buy-here-pay-here place of which there are several. The other point I would like to make is that they don’t hide the APR or anything from you. Before they do anything, they send you a contract with all of the pertinent info in it and you have to sign and return it. If you are foolish enough to not read it, then that is your fault, not theirs. But as with any situation, if you don’t have good credit, then you are going to pay a higher price for things, if you can get them at all. If you have good credit, then you don’t need this service anyway.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hi trfblueeyes,
    Thank for your comments.

  • HAMEED JOHN FELICIER

    I’M GOING THROUGH TOUGH TIMES OF A BLUE HIPPO COMPUTER SCAM MYSELF. TO MAKE A FUSTRTATED STORY SHORT ,I WAS SOLD A PIPE-LINE DREAM OF RECIEVING MY LABTOP COMPUTER IN A MATTER OF 6 WEEKS;HOWEVER, I HAVE NOT RECIEVED IT YET. PLEASE ASSIST ME IN THIS MATTER. A.S.A.P! THANK YOU!

  • David Anderson

    Why do u think it is a Scam? Coz i m trying to place an order to them and after reading the comments by u ppl i got confused i got into 2 minds. plz Help me out?

  • http://km1843@clearwire.net ken

    I am a consumer who has purchased a computer through a company like blue hippo ! I have been waitin for a long time .It seems to be so many scams that deal with computers these days you cant be sure who is the good guy and who is the theif ! Any way I paid a lot for a computer that never got sent to me .I am out of pocket ( 2,338.48$ You trust that what you see on tv is not a scam ,how could it be I would not do that to someone ,so how can somebody do that to me ! O right we are at WAR .! You trust someone and you get burned . Will i ever see my money ! maybe But i have baught another pc, A laptop that i am happy with so those who screwed me can suck a lemmon Thank you for your time Ken

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello Ken,
    I would recommend going to your local court and filing a small claims against BH to see if you can get reimbursed.

    Best of luck, Ron

  • anonymous

    I used to work there, the post above about building credit is absolute sh*t. It is obvious that you work for Rensin if you are not actually him, trfblueeyes.

    They do not report to the credit agencies except if someone defaults, they use lawyers to get judgements, now that looks great on your credit.

    I listened to this poor woman’s call to “customer support” one time, she was complaining that she just went through a divorce and it ruined her credit, she bought a computer from BlueHippo and paid it off early, hoping it would help her with her credit. Not surprisingly, there was no reference on any of the three credit reports of her ontime payments. She even said she could have bought it for cash, the whole idea was to rebuild her credit.

    After that I left the company. I sort of blamed the “victims” as Joe used to call them but after hearing countless complaints and verified lies like the “help rebuild your credit” bullsh*t I could not take it anymore.

    Maybe they started reporting now but only because of the FTC if at all. As a former employee, all I can say is Joe Rensin is an absolute scumbag. Anyone, and I mean ANYONE looking at doing business with him, not just buying a computer but selling him one or even working on his home, think again, if you are smart, walk away.

  • Casey Strong

    I definitely agree with everything I’ve read so far. I hit my 13 weeks back in January (2008) and have still yet to see my computer. I’ve called them numerous times and have gotten nowhere. I’ve heard the following:
    -”It’ll ship in 2 weeks” (That was 2 months ago)
    -”There isn’t a shipping date available” (whatever that means?)
    _”There isn’t a manager available to speak with” (…ever)
    -”It should definitely ship within a couple days” (That was 2 weeks ago)
    -”We’ll be sure to call you when it ships out” (Sure… you… will…!)
    So far I’m out $1200 and plan to stop the bleeding immediately after reading everyones stories. As of what to do next I’m not real sure. Any advise would be greatly appreciated. For Example; If I go to my local court and file a small claims against them am I gonna have to take days off work, pay a lawyer, etc.?

    I’m going to be researching my options and asking lots of questions so if anyone else who’s also getting screwed over by them wants to they can email me and we can try to help each other out on what we need to do (or if you just want to vent, I know I sure am pissed off right now).

    Casey
    kcs_3301@yahoo.com

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello anonymous,
    Thanks for the info.

    Hi Casey,
    I sincerely hope that you are able to work ou tthis problem with BlueHippo.

  • http://www.bowspritcomputerleasing.com Tom Digan

    Don’t wait months to get an obselete PC! I heard so many complaints about Blue Hippo that I started my own web-site to provided late model PC’s to consumers. And my name and phone number is on the web-site! Check it out, http://www.bowspritcomputerleasing.com.

    Tom Digan

  • http://none Chris j.

    I knew it, I don’t need a computer, but the tacky commercial just eats me alive every time I see it! There is another pushy tacky commercial on now with a black curly headed gal that is pushing you call a number if you want to earn LOTS AND LOTS of money. Commercials like these should not be allowed on the television and my mute button on the remote is used A LOT lately. Thanks for this site.

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hi Chris j.
    I hear you. :-)

  • http://www.classifiedpleasure.com Jennifer

    I am currently writing an article about the Blue Hippo scam and will state the facts that I have gathered about this company and why they are ascam. After 5 yrs in business they still have an unsatisfactory BBB rating and how they are still in business is beyond me. In my article I will be referencing to other companies that will provide you with a product and keep to their word. We work to hard for our money and credit rating to have inconsiderate self-serving companies take our money and run or charge us three times the value of a product.

    P.S. Ron, please get back to me about writing about computers. My partner may be interested.

    Thanks

  • Patrick Skadowski

    I too am a “casualty” of the BlueHippo regime. I must agree with the earlier statement that witha “little thought” you would think an individual would “think twice.” I responded to the television add also. And “Dave” really put on the show while giving me his rendition of the “this is a great deal pitch.”
    I just received and returned my financing agreement from BH…”Bad Habit”…and today received an email telling me something entirely contrary to a previous email from last month stated. It was from “Dave.” As follows…”Hi Patrick….,
    this is David and I just wanted to congratulate you for making your payments on time and to tell you that your Dell Laptop 2007 will be ordered, built and shipped soon as you have made the required number of payments for us to finance your balance.” Shortly after that I received the 2nd set of papers I mentioned earlier. Recently I searched the model I’m paying for right now through BH and found it at $399.00 from the manufacturer. Now…if you call BH customer service line, and wait long enough, you will hear this hilarious lie about your computer being ordered and built to your specifications. They just keep on lyin’ and because my motto is..”you make the deal…you stand by it.” I’ll finish this obligation because it’s the right thing for me to do. I will be keeping a close eye out for a class action suit in the future. I should have remembered the best truth I’ve ever heard when purchasing ANYTHING…”Buyer Beware. God Bless you all.

  • Patrick Skadowski

    Anyone else notice that Ron’s site/page…yup, this one that you’re on right now has an ad By & FOR BlueHippo. What gives?

  • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

    Hello Patrick,
    I just checked this site and didn’t see a Blue Hippo a, which does not mean it wasn’t present when you viewed the site.

    The way the ads works is that they are rotated through all of the sites at random intervals.The ads are controlled by the advertising company, i.e., Google and so forth.

    If a Blue Hippo ad was present, I apologize.

    Thanks for pointing this out. Regards, Ron

  • Mikehokhurtz

    I am very familiar with the BH business model. The information that people have posted on this blog, for the most part is on a baseline level and (I GUARANTEE!) sheds no light on the specifics of the individual’s account. I’d like to make a couple of points as an insider.

    1. These companies DO NOT make outbound sales calls. You called them.
    2. These companies are REQUIRED by law to provide all of the information about the transaction AND THEN they ask you to verbally authorize the transaction. You agreed to it.
    3. You signed a LAYAWAY contract. Does everyone understand what LAYAWAY means? http://en.wikipedia.org/wiki/Layaway
    4. Companies like BH, that do not check your credit history take an enormous risk by allowing everyone and anyone to be their customer. These companies must protect their investment. The protection is the layaway contract. If the company ever discovers something about you that makes the company feel uncomfortable about financing you (by you telling them or by researching (remember that thing called the internet – there is much info. about you available WITHOUT checking credit histories)) You remain in layaway until the discrepancy is cleared up or the company feels comfortable in financing you. Remember you verbally agreed to it AND you signed the contract.

    SIDE NOTE: From a previous blog entry – the ex-employee from BH obviously didn’t pay attention during their training, and no, I am not or never was a BH employee. Layaway payments are not (and cannot) be reported to credit bureaus. Maybe that is why they are called “Credit” Bureaus and not “Payment” or “Layaway” Bureaus. When the BH customer called in to request to payoff her computer sooner – She should have been told that it would be defeating the purpose of the program. A paid off computer is no longer being financed and there is nothing to report to the credit bureaus. So I am questioning her intention of wanting to improve her credit score.

    5. The APR that these companies charge is typically 19-20% and the contract is for 1 year. Face it – you have bad credit. Why? 1 of 2 reasons. 1. You either have a history of not making payments. or 2. You have a history of not upholding the terms and conditions of the contracts that you have entered into in the past. Basically, you are not trustworthy. Not everyone who has bad credit falls into those 2 categories because they are bad people. Many people have poor credit histories because of medical bills that have mounted due to not having insurance (write your local congressman and ask for his opinion on universal healthcare?) Many of you make comparisons to purchasing computers for ~$500. Obviously, the best way to purchase something is with cash. But face it, this is America – we don’t buy things with cash and certainly don’t buy only things that we can afford, so we finance it. 19-20% interest is actually not that bad. Why is no one screaming about credit card companies who’s APRs can be anywhere from 20-29%? Keep in mind, probably 80-90% of people who use credit cards do not pay off the balance monthly and usually only make the MINIMUM MONTHLY PAYMENT (interest charges only, with little or NO money applied to the principal). Credit card companies allow this and it is part of the credit card business model. Let’s compare how MOST people purchase things on credit to BH.

    Would you rather pay $500 or $1500 for the same computer? Depends on the terms. Ready? I’ll explain:

    $500 computer with Capital One (who targets bad credit individuals) – only minimum monthly payments made…you will end up paying close to $3500 and it will take you 3 or more years to pay it off (assuming you only purchase the $500 computer on that card and never purchase anything else).

    $1500 computer with a company like BH – The contract forces you to pay PRINCIPAL and INTEREST on a formula that has the computer paid off in one year.

    So let me rephrase the same question. Would you rather pay $3500 or $1500 for the same computer?

    Regarding Consumer Protection Agencies – The BBB can not make a company do anything. They simply process paperwork and inform the company that a customer has made a complaint. The BBB is supposed to be used by customers who are not able to communicate with a company – NOT for customers who have signed contracts and are trying to wiggle out of their responsibilities to uphold the terms and conditions.

    I would be very interested to read Jennifer’s article on the BH “Scam”. Hopefully it will be unbiased as articles should be, but it already appears to be something by someone who is just “piling on”.

    Comments are most welcome.

  • Failtelorn

    So, I arrived here after hearing a radio spot for BH. I was googling BH to see what people had to say about it and wow… I have to agree with the folks that offer the reminder that each customer is signing a detailed contract and choosing to make the payments despite the value of the product. For those that claim to never have recieved the computer after paying a grand or more? I’m guessing that got fed up paying and not seeing the computer before the year had passed. Granted, the contract and hype suggests that you get it sooner rather than later, but it’s also fully within their rights to withhold the computer until the very last payment has been processed. I didn’t notice anyone having mentioned making every payment and still not recieving a computer. Could that be why?
    Anyway, good luck to everyone that believes they’ve been wronged.

  • Don

    About BLUE HIPPO ~~~~~~~ They are Rat Bastards!
    they will send you yor stuff when your Account is paid in full.
    Then after many phone calls and telling them you are going to contact the attorney generals office they get there act together
    and ship out the products that you busted your ass paying on
    a payment plan. so put the fear of GOD and the ATTORNEY
    GENERAL in their face and you should recive your goodies
    in aprox. 2 to 4 weeks. Note: YOU HAVE TO KEEP ON THEIR ASS! Hope it all works out for YOU!

  • Zuleyka

    Blue hippo is a SCAM!! I ordered my stuff and the very next day I cancelled. they still took 200 dollars out of my account and then when i called they new how much money was in my bank account. How would they know that info. everytime I call the costumer service line im on hold for a very long time with some stupid recording that plays over and over again. Its a scam and I cant beleive that thhey are still in business. I had to close my bank account just so that they would stop taking money out. so no i did not have a problem getting my stuff i had a problem with canceling. Blue Hippo are a bunch of thieves…professional thieves.

  • Bill Hiscott

    Wow..several years ago I would have fell for this.But im very much in control of my own thoughts.I think everything through first.It sounded to good to be true.I think we all have a brain for a reason..too bad most of us don’t think before we act.

  • Anthony

    I was considering going the BH route (to build credit), but after reading this stuff, I’m not so sure now. But its not really even about the scams and stuff… If I start making payments on a brand new computer today, and I won’t get it until 6 to 13 weeks, that computer will already be old news. especially if that “6 to 13 weeks” means 6 months or longer, as someone mentioned way up at the top..

  • A** Out

    I have paid for the computer in full and still have not recieved anything; its been over 4 months BH is the worst how are these people still in business!!!!!!!!!!:(

  • Pingback: BlueHippo Paid $5 Million Fine To FTC - But Was It Enough? ~ The Blade by Ron Schenone, MVP

  • http://AOL.COM MARY LD BERRY

    CAN ANYBOY HELP ME WITH BLUE HIPPO I CAN’T GET A NUMBER THEY A LOT OF MY MONEY BUT I DON’T HAVE HELP ME IF YOU CAN.

  • http://comcast ilia rivera

    i would like to have a number to reach bluehippo.they promised my laptop in 6 weeks.they have taken my down ayment and my $29,95 a month since october 2009 and have not yet recieve my lab top.please some one help me via email above.

    • http://wp3.lockergnome.com/nexus/blade/ Ron Schenone

      I would call the Attorney Generals office for your state and the BBB.