Most people know about Whole Foods Market's nickname of "Whole Paycheck," but just how true is that moniker? Most people believe that the prices at the upscale market are due to the fact that the store specializes in organic produce, hormone-free meats, and wild-caught seafood. But California inspectors claim that Whole Foods Markets engaged in practices that violated consumer protection laws regarding false advertising and unfair competition, according to USA Today.
In a news release, Los Angeles City Attorney Mike Feuer states that his office, along with city attorneys for Santa Monica and San Diego, reached an $800,000 settlement with Whole Foods Markets after a statewide investigation uncovered widespread pricing violations throughout California.
"We're taking action to assure consumers get what they pay for," says Feuer. "No consumer should ever be overcharged by their local market."
The settlement is the result of a yearlong investigation that took place with the cooperation of Whole Foods and found that the grocer was charging more than advertised prices for many food items, including:
- Failing to deduct the weight of containers when ringing up charges for self-serve foods at the salad and hot food bars.
- Giving less weight than the amount stated on the label, for packaged items sold by the pound.
- Selling items by the piece, instead of by the pound as required by law (such as kebabs and other prepared deli foods).
In addition to the fine, Whole Foods has agreed to appoint two state coordinators to oversee pricing accuracy in stores, including the designation of an employee at each store who will be responsible to ensure pricing accuracy. In addition, WFM will conduct random audits of each California location four times per year.
It seems like these overcharging practices extend beyond California's borders. The New York City Department of Consumer Affairs (DCA) announced an ongoing investigation into Whole Foods after finding that the company's NYC stores "routinely overstated the weights of its pre-packaged products — including meats, dairy, and baked goods resulting in consumers being overcharged." In a release, the city's DCA tested packages of 80 different prepackaged products and found all of the products had mislabeled weights, with overcharges "ranging from 80 cents for a package of pecan panko to $14.84 for a package of coconut shrimp." Examples of the overcharging include:
- DCA inspected eight packages of vegetable platters, which were priced at $20/package. Consumers who purchased these packages would have been, on average, overcharged by $2.50—a profit of $20 for the eight packages. One package was overpriced by $6.15.
- DCA inspected eight packages of chicken tenders, which were priced at $9.99/pound. Consumers who purchased these packages would have been, on average, overcharged by $4.13—a profit of $33.04 for the eight packages. One package was overpriced by $4.85.
- DCA inspected four packages of berries, which were priced at $8.58/package. Consumers who purchased these packages would have been, on average, overcharged by $1.15—a profit of $4.60 for the four packages. One package was overpriced by $1.84.
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DCA Commissioner Julie Menin said, “It is unacceptable that New Yorkers shopping for a summer BBQ or who grab something to eat from the self-service aisles at New York City’s Whole Foods stores have a good chance of being overcharged. Our inspectors tell me this is the worst case of mislabeling they have seen in their careers, which DCA and New Yorkers will not tolerate. As a large chain grocery store, Whole Foods has the money and resources to ensure greater accuracy and to correct what appears to be a widespread problem — the city’s shoppers deserve to be correctly charged.”
In New York, the fine for falsely labeling a package can be as high as $950 for the first violation and up to $1,700 for subsequent violations, with NYC's DCA saying that Whole Foods' violations could number in the thousands.
It is not known whether Whole Foods Markets in South Florida will change the way they package foods in response to the investigations. We have messages in to the company and will update this article with any additional information.