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Suit Alleges Wholesale Club Fraud
100 People File Suit Against Ind.-Based DirectBuy
POSTED: 5:33 pm EST February 10, 2010
UPDATED: 7:05 am EST February 11, 2010
INDIANAPOLIS -- Indiana-based wholesale club DirectBuy is at the center of a lawsuit over the deals it claims to deliver.The suit, filed on behalf of 100 people in federal court on Wednesday, alleges the company pressures people into a $5,000 membership, and then charges mark ups on products and excessive shipping fees, all while hiding tens of millions in annual rebates from manufacturers."When you enter the agreement you are not going to necessarily get better prices. You will pay fees that you won't other than through this device," said attorney Irwin Levin, who is seeking a class-action suit against the company.The Merrillville-based wholesale group boasts 160 clubs in the United States and Canada with more than 400,000 members, 6News' Rafael Sanchez reported.The company's Web site claims members can save up to 50 percent on electronics, furniture and appliances."The advertising by DirectBuy entices you that you are in the position of the person who is a wholesaler, and you are not," Levin said.DirectBuy did not respond to a request for comment on Wednesday.
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