Jul 9, 2009 6:50 pm US/Eastern
CVS, Shaw's Ordered To Fix Overcharging Problems
BOSTON (WBZ) ―
State consumer officials have met with representatives of CVS and Shaw's to talk about how to fix a problem that's hit customers right in the wallet -- illegal overcharges. An overcharge occurs when an item scans at the checkout for a higher price than is posted on the item, a sign or the shelf.
Undersecretary Barbara Anthony of the Office of Consumer Affairs and Business Regulation tells WBZ-TV it's important, especially in these tough economic times, for consumers to be assured the price they see on the shelf is the price they'll pay at the register.
"So we're very concerned when we see incidents of overcharges that are high above what we think they ought to be. We call it our overcharge hit parade. If you make the overcharge hit parade you'll probably get an invitation to come in and talk with us about what remedial changes you plan to make to fix the problem in your store," said Anthony.
In 2007 and 2008, no retailer paid more in fines for overcharging customers than CVS, according to data from the state's Office of Consumer Affairs.
State inspectors found 425 instances of overcharging in 2007, and 711 in 2008. The state fined CVS $359,600 for the violations. The number of violations was significantly higher than those for other retailers.
"These problems are solvable. Other retailers have solved them. It takes training the labor force, it takes management initiative and oversight, but none of this is insolvable. And I think it's fair to say retailers understand that and now they really have to. The rubber's meeting the road and now they have to bring about results."
Anthony says she is encouraged by the plan CVS will implement, which includes internal and external audits, weekly price reviews and technological improvements.
Anthony says inspectors who have visited Shaw's have found the retailer to be "trending upward" where overcharges are concerned. The data shows 81 instances of overcharging in 2007 and 320 in 2008.
Anthony says Shaw's is developing a remediation program and has asked for employee training from the state's Division of Standards.
Anthony says the state will give both stores 30 to 45 days to put plans in place, and will then begin random inspections to see if the plans are working.
CVS STATEMENT
CVS spokesman Michael DeAngelis issued the following statement.
"We make every effort to ensure that the prices posted in all our stores are accurate and we continue to make significant investments in technology and training to improve accuracy. We have at least two price-checker kiosks for customers in every CVS location in Massachusetts and our cashiers have the ability to check the price of any item at the register at a customer's request. We also build additional hours into our store employees' schedules to help ensure full compliance with Massachusetts' item pricing law.
"We continue to implement programs to ensure compliance, including the posting of item pricing guidelines to educate store employees, monthly internal store audits by regional management and regular external audits by an outside agency. We are also in the process of enhancing the technology we use to ensure our shelf label prices match the correct prices that are charged at our registers. With more than 100,000 items in a typical CVS/pharmacy, compliance with the item pricing law is a complicated, labor-intensive process that, unfortunately, is not immune from human error.
"Whenever a discrepancy between a posted price and the price being scanned is found, we always honor the lower price."
SHAWS STATEMENT
Dina Piran of Shaw's Supermarkets released this statement.
"A number of retailers have been asked to meet with the State regarding this matter. Shaw's is working closely with the Division of Standards Office of Consumer Affairs to provide additional training to our operators to ensure that our customers receive accurate pricing."
Anthony says her office will be meeting with other retailers about overcharging, though she would not specify which ones.
(© MMIX, CBS Broadcasting Inc. All Rights Reserved.)
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