Loclly to cease misleading practices and pay $94K in fees and restitution

September 9, 2013

ATLANTA, GA – John Sours, Administrator of the Governor’s Office of Consumer Protection (“GOCP”), today announced that the agency has entered into a settlement with daily deal company Loclly (Thanxme, LLC, doing business as Loclly and loclly.com), and Michael Ferguson, the company’s principal officer. 

Loclly offers consumers discounted vouchers on various merchandise and services.  Consumers pay Loclly via its website and then print out a voucher, which the consumer then presents to the actual vendor (e,g., the restaurant, spa, car service station, etc.) in exchange for the product or service purchased. 

In the settlement, GOCP alleges that the company committed various violations of the Fair Business Practices Act, as detailed below.

Even after Loclly had become aware that certain vendors were not honoring vouchers for their products or services, Loclly continued to advertise and sell vouchers for those products and services. When consumers discovered they were unable to redeem their vouchers, they contacted Loclly, but the company refused to issue refunds and would only offer store credit. This was also a violation of Loclly’s promise of “100% satisfaction guaranteed.”

GOCP also alleges that Loclly misled consumers by listing inflated values for vouchers and misrepresenting when deals would expire in order to create a false sense of urgency.

“These were very troubling allegations,” says John Sours, Administrator of the Governor’s Office of Consumer Protection.  “Internet transactions have become an integral part of today’s economy. We can’t tolerate misleading practices by online merchants.”

Under the settlement Loclly and its owner are required to pay a $40,000 civil penalty and $35,000 in administrative expenses. They must also pay $4,105.60 in direct restitution to 42 consumers and another $15,000 to the State as a restitution trust fund for issuing refunds to eligible consumers. Consumers who believe they may be entitled to compensation under the settlement can fill out a claim form and submit it to GOCP, along with supporting documentation. Claim forms must be postmarked, faxed or hand-delivered no later than 5:00 p.m. EST on October 9, 2013 in order to be considered for restitution.

Eligibility

In order to be eligible for restitution, the claim must meet the following requirements:

  1. The claim must involve a consumer transaction with Loclly;
  2. The claim must be related to Loclly’s improper denial of a refund, including but not limited to those complaints alleging that the company failed to comply with its stated refund policy, and/or alleging that the purchased voucher was not honored.
  3. The consumer must not have previously received a full refund from Loclly for the disputed transaction. If the consumer received store credit from Loclly but has not used it to make another purchase, the consumer may still be eligible for restitution.

Filing a Claim

Consumers can download a claim form here.  Completed claims, along with supporting documentation, should be faxed to the Governor’s Office of Consumer Protection at 404-651-9018 or sent via mail or overnight delivery, or hand-delivered to:

Governor’s Office of Consumer Protection
Attn:  Loclly Restitution Program
2 Martin Luther King Jr. Dr. SE
Suite 356
Atlanta, GA  30334-9077

Claims must be postmarked or faxed no later than 5:00 p.m. EST on October 9, 2013.

Press Contact Info

Shawn Conroy
404-656-3790