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ConsumerWatch: San Francisco Restaurant Diners Complain of ‘Tip Padding’

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SAN FRANCISCO (KPIX) — Be careful when you use your credit cards at a restaurant, or hold on to your receipts tightly. Some restaurant employees might be sneaking a few extra dollars onto the final bill.

It’s called “tip padding”, increasing the tip after a customer has signed their receipt.

Lynsay Paulo says she was a victim of “tip padding”. Earlier this year, Paulo dined at Chaya, a popular San Francisco restaurant. Days later, Paulo says, she discovered she was charged five dollars more than the amount she had authorized as a tip on her receipt.

“I felt ripped off,” said Paulo.

The scam wasn’t exactly a surprise to the Sacramento business woman, since local friends had already tipped her off about “tip padding” in the City by the Bay.

“Restaurants were charging up one dollar, five dollars in one case,” Paulo said. “Eighteen dollars on her bill.”

Food Columnist, Michael Bauer, points out waiters or hosts sometimes bank on the fact that many diners don’t check their receipts.

“What you’re dealing with are individuals that are doing it, not a big conspiracy among restaurants,” said Bauer. “I can’t imagine management condoning that, it would put them out of business.”

Paulo says when she called her credit card company, it immediately corrected the charge.

The management at Chaya told Consumerwatch it considers tip padding “a major crime,” and “theft.” It also noted the server who rang up Lynsay’s order is “no longer an employee.”

“They said this happens all the time, particularly in big cities. San Francisco’s one of the worst offenders,” Paulo told Consumerwatch.

Visa suggests snapping a cell phone photo of your receipt after you’ve signed it, and Bauer says if you notice a discrepancy, call both the credit card company and the restaurant, so it can take action against any rogue servers.

(Copyright 2013 by CBS San Francisco. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)

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