Consumer

ConsumerWatch: Safeway Agrees To $2.25 Million Settlement For Overcharging

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A receipt from a Safeway supermarket in Burlingame. (CBS)

A receipt from a Safeway supermarket in Burlingame. (CBS)

PLEASANTON (KPIX 5) –  Safeway has agreed to change its practices and make a $2,250,000 fine as a result of a complaint brought on behalf of several California counties due to pricing irregularities.

In 2012, ConsumerWatch reporter Julie Watts went undercover shopping at 5 Safeway stores in 3 counties. She was overcharged 5 times.

According to more than 1,800 scanner inspections at Safeway-operated stores in 31 California counties and 11 different states, KPIX 5 ConsumerWatch discovered that inspectors were overcharged on 1 out of every 50 items purchased over a 5 years span in California alone.

“Within at least the last four years Safeway unlawfully charged consumers prices that were higher than its lowest advertised price, misrepresented the weight of Safeway-branded products, and made statements on in-store signage that conveyed the impression that certain produce was “locally grown” when in fact it had been sourced from outside of California,” read the complaint on behalf of Alameda, Marin, Fresno, Napa, Sacramento, Santa Cruz, Solano, Sonoma, and Ventura Counties.

The company was also accused of failing to follow a 2008 mandate to minimize pricing discrepancies at stores. As part of that agreement they were ordered to handing out gift cards or giving away items priced under $5 when irregularities were found.

Read More:
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Under the terms of the deal announced Thursday “Safeway agreed, without admitting liability, to be bound by an injunction prohibiting it from: making any false or misleading statements; charging an amount greater than the lowest price posted on a commodity or on a shelf tag; failing to honor any valid Safeway coupons, discounts or offers; and failing to clearly and conspicuously disclose any inclusions, exceptions or limitations to any Safeway offers, coupons or discounts,” reads a press release from the Alameda County District Attorney.

During KPIX 5’s 2012 reporting, Safeway officials claimed that their error rate was “squarely within industry norms.

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