NEW YORK (Legal Newsline) - New York Attorney General Eric Schneiderman announced a settlement Thursday with Sears, Roebuck and Co. to resolve allegations that the company used a deceptive refund policy.

Sears applied the allegedly deceptive refund policy to consumers who participated in its Come Back Cash promotion, in which consumers who bought merchandise over a certain threshold would receive a $10 or $20 promotional award card. When consumers returned some of the merchandise, Sears allegedly reduced the refund by a prorated amount of the value of the award card. Sears allegedly kept the policy in place even if the cost of the unreturned merchandise remained above the threshold and/or if the customer did not cash in the promotional award card.

"This settlement ensures that consumers who participate in a promotion of this type and later return merchandise will receive a full and fair refund - and not a penny less," Schneiderman said. "Sears' refund policy improperly reduced refunds to customers whose purchases stayed above the qualifying threshold in the promotion, or whose promotional award card had already expired without being used."

Schneiderman's office alleged there were 25,998 transactions involving New York consumers whose refunds were reduced improperly for a total of $82,825.62 in reduced refunds.

Under the terms of the settlement, Sears agreed to pay $150,000 in fines and reform the refund policy going forward.

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