Jewellery-store chain Friedman's Inc. said Thursday (2 October)the U.S. Justice Department is investigating a dispute over accounts receivable.
Nearly three weeks ago, Capital Factors filed a lawsuit against Savannah, Ga.-based Friedman's and 13 others alleging misrepresentation of a former vendor's accounts receivables.
Capital Factors purchased for cash the accounts receivable of Cosmopolitan Gem Corp., a former vendor of Friedman's.
The others named in the suit include Crescent Jewelers and Whitehall Jewellers Inc.
Capital Factors also alleges that Cosmopolitan Gem's customers improperly made payments directly to Cosmopolitan Gem.
Capital Factors is seeking damages of $30 million as well as punitive damages against all the defendants.
Friedman's said it intends to fully cooperate with the Justice Department and give the agency any information it may request.
