Home Depot to pay nearly $2M penalty for allegedly overcharging customers
In an aerial view, a sign is seen posted on the exterior of a Home Depot store on Feb. 21, 2023, in El Cerrito, California. (Credit: Justin Sullivan/Getty Images / Getty Images)
Home Depot is being ordered to pay nearly $2 million to settle a civil claim from California district attorneys that the company overcharged customers for products.
According to Los Angeles County District Attorney George Gascón, the retailer allegedly "engaged in false advertising and unfair competition" because it charged customers prices higher than the lowest advertised or posted price.
This type of offense, known as a "scanner violation," occurs when the price on the item or on the item’s shelf tag does not match the universal product code that's scanned at the point-of-sale device or register, according to Gascón.
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"When companies engage in deceptive practices, they not only cheat consumers but also gain an unjust advantage over businesses that operate ethically and transparently," Gascón said in a statement.
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Under the Aug. 26 court order settling the dispute, the home improvement company was barred "from engaging in false or misleading advertising and charging an amount greater than the lowest price posted for an item."
A specialty assistant manager for Home Depot checks inventory with a new portable device. (Creditr: Chris Rank/Bloombereg / Getty Images)
While the company admitted to no wrongdoing, it is required to implement a price accuracy program, which will add more audits and training, and eliminates price increases on weekend days, according to the district attorney's office.
The company is also required to pay $1.7 million in civil penalties and $277,251 in costs and restitution.
Home Depot told FOX Business that to "ensure consistency" for customers, it has updated the timing of its price changes.