Utah-based jewelry company Paparazzi has agreed to pay $1.9 million and change its business practices in Washington state following an investigation by the Attorney General's Office into allegations of a pyramid scheme. The resolution comes after findings that Paparazzi violated the state's Consumer Protection Act and Antipyramid Promotional Scheme Act.
Attorney General Nick Brown announced that 7,100 Washington residents who sold jewelry for Paparazzi will receive checks averaging $180. "Our investigation showed Washingtonians were clearly harmed by Paparazzi," Brown stated. "Advertising too-good-to-be-true returns on investments is one of the ways companies and individuals try to deceive Washingtonians."
The agreement allows sellers to return unsold merchandise purchased after January 2017 for a full refund. It also mandates increased transparency from Paparazzi if it continues operations in the state. Additionally, there is now a claims process for refunds related to jewelry containing lead and nickel, despite previous advertising claims that these products were free from such heavy metals.
Paparazzi must also revise how it advertises its sales program, ensuring full disclosure of potential income for sales consultants.
The Consumer Protection Division is primarily funded through recoveries from businesses violating consumer protection laws, not taxpayer money. These funds support various divisions within the Attorney General's Office, including Consumer Protection, Antitrust, Wing Luke Civil Rights, Environmental Protection, Medicaid Fraud Control, and Complex Litigation.
Assistant Attorneys General Ben Brysacz and Joe Kanada led the case with paralegals Joseph Drouin, Luis Oida, and Heather Zamudio. Former Assistant Attorneys General Susana Croke, Kevin Eggers, and Camille McDorman also contributed before leaving the office.
The Attorney General’s Office serves as Washington's largest law firm providing legal representation to state agencies while enforcing consumer protection laws among other responsibilities across nearly all counties in Washington.