Whole Foods Fined $800,000 For Overcharging Californians
Whole Foods will pay $800,000 in penalties following an investigation which found the retailer had overcharged its customers in California
Whole Foods Market, Inc. (WFM) will be paying $800,000 in penalties and fees following a yearlong investigation from state and local inspectors, who had been probing whether the company’s two California-based subsidiaries – Whole Foods Market California Inc and Mrs. Gooch's Natural Food Markets Inc – had been overcharging customers.
Inspectors found that products stocked at the grocery store chain weighed less than advertised, and the weight of salad bar containers was not discounted at the time of checkout. Additionally, specific items, such as kebabs and deli foods, were being priced by the piece instead of by the pound, as is required by law.
On the findings of that investigation, Whole Foods Market is required to pay $630,000 in civil penalties to the city attorneys of Los Angeles, Sand Diego and Santa Monica, all of whom worked on the case against the company. Additionally, Texas-based Whole Foods will be paying $100,000 to a consumer protection trust fund and reimbursing $68,394 in costs incurred by state agencies as they investigated the retailer.
Whole Foods Market is also required to randomly conduct a quarterly audit of its 74 stores in the state of California over the next five years, and must appoint state and store-level managers to exclusively supervise pricing accuracy at its stores.
Whole Foods pricing is 98% accurate, the company has said in an official statement, while stating that it cooperated fully with investigating authorities. Going forward, it will “continue to refine and implement additional processes” to streamline the pricing aspect of its business.
Whole Foods stock fell 0.74% yesterday to $38.95. Year-to-date, the stock is down 32.5%.