Friedman's Eyes Bankruptcy Filing

January 12, 2005

Friedman's Eyes Bankruptcy Filing

Jewelry retailer Friedman's, Savannah, GA, which is facing federal fraud probes, said it may file for bankruptcy because its lenders are blocking it from accessing needed funds. According to Reuters news service, the retailer said lenders are letting it draw upon its senior credit facility only on a discretionary basis. As a result, it said, "the company has not been able to satisfy all of its cash requirements."

The jewelry retailer, with 650 stores in the U.S., said it is talking to its lenders about its funding needs and possibly amending the credit facility.

Friedman's was recently sued by the state of Florida for allegedly "duping" customers into paying for life, property and other insurance while they thought they were insuring their financing of jewelry purchases. Many of its senior executives have left the company in recent months.

by Michael Thompson

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