Buy.com Settles Dispute with New York Over Ad

Internet retailer Buy.com Inc. settled a dispute with New York state regulators Wednesday by agreeing to put additional disclosures in its advertising for a computer sales special.

The case stemmed from a promotion begun last August in which the Aliso Viejo online superstore offered computers for $269 after mail-in rebates.

The New York attorney general’s office called the offer deceptive because it did not disclose that to get the computers at the advertised price, consumers would have to sign up for three years of Internet service costing more than $20 a month.

Consumers also were not warned that they might incur long-distance telephone charges in using the Internet service or that canceling early would result in fees and the loss of the rebate, the state agency said.

About a dozen consumers complained about the ads, an agency spokeswoman said.

Executives at Buy.com, the nation’s fifth-largest Web retailer, did not return calls Wednesday about the case.

In settling, Buy.com said it would disclose the conditions of similar offers in the future but did not admit any wrongdoing. The company was not fined or required to pay consumer restitution.