Whole Foods Market agreed to pay $800,000 in penalties and remain under firm oversight for five years after California officials determined the grocer was overcharging customers throughout the state.
The Santa Monica City Attorney’s Office said that state and local investigators conducted a yearlong investigation that found “widespread pricing violations” in the stores owned and operated by the Austin, Texas, organic grocer.
Investigators said that Whole Foods had been overcharging its customers in various ways including charging customers the weight of containers for self-serve (salad bar, hot bar, etc.) and unpackaged bulk foods rather than deducting the weight as required by law.
“By adding the weight of containers and packaging, especially on higher-priced, per-pound items like seafood and meats and even prepared food, the extra charges can add up fast, and yet be hidden from consumers,” Santa Monica Deputy City Attorney Adam Radinsky said in a statement.
Investigators also found that Whole Foods was overstating the weight on foods that it packaged and sold by weight and that the company’s delis violated laws mandating certain items be sold by the pound instead of by the piece.
Whole Foods agreed to pay $630,000 in civil penalties, $100,000 to a California Consumer Protection fund, and $68,394 in investigation costs.
The company also agreed to a five-year court injunction that will impose stricter oversight of the 74 Whole Foods retail locations in California. The injunction orders the company to charge accurate prices, conduct random pricing audits, and appoint an employee at every store to monitor pricing. Whole Foods also agreed to hire two state coordinators to monitor pricing accuracy.
Whole Foods in a statement said “human error” may have contributed to all the inaccurate pricing and said its own investigation found accurate prices 98 percent of the time.