Whole Foods Market, Inc. (NASDAQ:WFM) is to pay $500,000 to settle allegations it overcharged customers in New York City stores on pre-packaged foods. As part of the settlement, the retail chain is to carry frequent audits to ensure products are properly weighed and labeled.
Whole Avoids $1.5 Million Fine
Should agency inspectors identify any mislabeled pre-packaged food at a store in future, then the affected store will have to check the accuracy of 20 other products from the same department. Whole Foods Market, Inc. (NASDAQ:WFM) is also required to implement and enforce policies that prevent employees from estimating weights of products.
“Whole Foods has already put in place third-party audits to ensure pricing accuracy,” said spokesman Michael Silverman in an emailed statement.
Whole Foods should heave a sigh of relief as the agency was initially pushing for a $1.5 million fine to settle the matter. Investigations by the city’s Department of Consumer Affairs found mislabeled weights in 80 different types of prepackaged food prompting the enquiry. The retail chain was found to have overcharged customers for as little as 80 cents to as much as $14.84 on a package of coconut shrimp.
Whole Foods Defense
The criticism that followed the probe initially hurt Whole foods sales at its Austin Texas-based chain. Co-executives Walter Robb and John Mackey were later forced to apologize in a YouTube video. Whole Foods in a statement defended itself by stating that there was no evidence of systematic or intentional misconduct by anyone
Mackey had initially raised concern over the way Whole Foods Market, Inc. (NASDAQ:WFM) was singled out arguing that the retail chain track record on the matter is no different from others in the industry. However, he has reiterated the chain’s commitment to preventing future overcharging by training customers. Customers affected by mispriced goods will receive a form of compensation in future.
It is not the first time that Whole Foods Market, Inc. (NASDAQ:WFM) has found itself in trouble over the way it labels and prices products in stores. In August, it came under fire after it was discovered it was selling a bottle of water with three stalks of raw asparagus for $5.99 calling it Asparagus Water
