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[UPDATE] Investigators Say Whole Foods Has Been Ripping Us Off More Than We Realized
By
Nell Casey
Published Jun 24, 2015
Modified Jun 24, 2015
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By
Nell Casey
Published Jun 24, 2015
Modified Jun 24, 2015
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[UPDATE BELOW] Sticker shock has always been part of the shopping experience at the city's Whole Paycheck luxury stores, but now it turns out some of these prices may be illegal. An investigation by the city's Department of Consumer Affairs has uncovered some shady price tags at our fleet of Whole Foods stores that show customers have been overcharged for their already pricey pre-packaged goods. "DCA tested packages of 80 different types of pre-packaged products and found all of the products had packages with mislabeled weights," according to a DCA press release. And we were just starting to trust you, Whole Foods.
The investigation looked at products that are weighed and labeled and found a "systematic problem" whereby customers were routinely overcharged for things like nuts, snack foods, poultry and other grocery products. Eight packages of chicken tenders—priced at $9.99 per pound—were inaccurately priced and labeled to the tune of a $4.13 overcharge to the customer per package, a store profit of $33.04 for the set. DCA says one package was overpriced as much as $4.85. "Additionally, 89 percent of the packages tested did not meet the federal standard for the maximum amount that an individual package can deviate from the actual weight, which is set by the U.S. Department of Commerce."
A current Whole Foods employee, who spoke to us on condition of anonymity, says the issue is incompetence. He says the company was aware of the labeling issue but actually eliminated the job position responsible for checking price tags, sales signs and tare weights in a bid to save money.
"So they replace these people who actually know what the fuck they are doing by making the position a part time one with cheaper employees under the umbrella of a different department," the employee told us. Team leaders were instructed to take special care in advance of this DCA investigation going public. "Except [the part time employees] are still barely trained and have almost no idea what the fuck they are doing."
Whole Foods wasn't the only city grocery targeted in the probe, but it received the worst report card by far. According to data obtained by the Daily News, the Union Square location was the naughtiest of any store in the city since 2014, with 15 mislabeled packages discovered over two inspections. Following closely behind, the Tribeca Whole Foods (14 overcharges) and Brooklyn location (13 overcharges) also discovered during two inspections. The chain's Chelsea location came in fifth place with eight overcharges, with the 14th Street Garden of Eden nestled in between.
This isn't the first time the chain has been accused of and cited for overcharging customers. Last year, the company was fined nearly $800,000 in California for not deducting tare weight, selling less than the weight on products sold by the pound and other violations. Not to be outdone by our neighbors to the West, "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," according to DCA Commissioner Julie Menin.
Though the DCA hasn't yet announced how much Whole Foods will be fined for the violations, our tipster tells us it's "pretty huge" and that Whole Foods is trying to settle. "They want a smaller figure than the one from when they were sued in California but NYC is asking for way more," the employee said. "The fine for falsely labeling a package is as much as $950 for the first violation and up to $1,700 for a subsequent violation," according to the DCA. "The potential number of violations that Whole Foods faces for all pre-packaged goods in the NYC stores is in the thousands."
Update, 2:04 p.m. Whole Foods has issued a statement blasting the DCA's allegations:
“We disagree with the DCA’s overreaching allegations and we are vigorously defending ourselves. We cooperated fully with the DCA from the beginning until we disagreed with their grossly excessive monetary demands. Despite our requests to the DCA, they have not provided evidence to back up their demands nor have they requested any additional information from us, but instead have taken this to the media to coerce us. Our customers are our number one stakeholder and we highly value their trust in us.”
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