Family Dollar to pay $63 million over alleged pricing discrepancies
The proposed settlement includes $40 million for customer refunds and $20 million for discounts following allegations of misleading price displays.
Family Dollar has agreed to a proposed $63 million settlement following allegations that the company charged customers more at registers than the prices shown on shelves, tags and advertisements, according to the Times of India.
The settlement, filed in a federal court in Virginia, covers thousands of stores across the country. Of the total, $40 million is intended for refunds, $20 million for customer discounts and more than $3 million for the states.
The Federal Trade Commission (FTC) and the state alleged that these practices cost consumers millions of dollars. The complaint stated that overcharges were most significant in low-income communities and that the company failed to fix the issue despite warnings.
Christopher Mufarrige, Director of the FTC’s Bureau of Consumer Protection, said the order will ensure the company stops deceiving consumers and returns money to those harmed by these practices.
The company's records reportedly showed customers complaining about its mobile application for six years. The complaint also noted that stores allegedly charged more at checkout than prices listed on their website and mobile app.
Under the proposed order, Family Dollar must implement a pricing programme that is independently reviewed and certified annually. The settlement remains a proposal until a judge signs off on the order.