230 isle residents
eligible for cash
from Sears

They will share a
national settlement over Sears'
debt-collection abuses

Star-Bulletin staff

About 230 local Sears Roebuck & Co. customers are eligible to receive payments under a settlement between Sears and the state Office of Consumer Protection.

The payments are part of a nationwide settlement in which Sears will forgive $125 million in debt and pay $125 million in restitution for unlawfully collecting debts from customers who had filed for bankruptcy protection.

The state said that Sears agreed to pay a $55,000 fine for collecting payments from local debtors who had filed for bankruptcy protection.

Sears also will forgive debts and pay fair compensation to consumers for any harm they may have suffered, said Jo Ann Uchida, executive director of the Office of Consumer Protection.

Uchida said she could not estimate the amount of restitution that Sears would have to pay local consumers since individual debts vary. A local Sears employee referred questions regarding the settlement to the company's mainland offices, which could not be reached for comment.

Hoffman Estates, Ill.-based Sears, one of the nation's largest retailers, admitted in the settlement that it failed since 1985 to get judicial approval for repayment agreements with more than 150,000 bankrupt customers. Several states found that Sears pressured local consumers who had filed for bankruptcy to make payments on debts even after the debts were canceled by a bankruptcy court judge.

Consumers who may qualify for the payments can call a hotline set up by the settlement administrator at (800) 529-4500.