MADISON, Wis. — Attorney General Josh Kaul, along with the Federal Trade Commission (FTC) and 16 other attorneys general, is announcing a proposed $63 million settlement with Family Dollar Stores to resolve allegations that the company routinely charged customers more at the register than the prices displayed on shelves, price tags, and advertisements.
Under the proposed order, Family Dollar would be prohibited from misrepresenting its prices and required to implement a pricing accuracy program that is independently assessed and annually certified.
“It’s not acceptable for a company to indicate that one price will be charged and, at the same time, charge a different price,” said AG Kaul. “The prices that are shown to customers must be accurate.”
According to the complaint, the FTC and states allege that thousands of Family Dollar stores nationwide have overcharged shoppers, and the company failed to correct the issue despite thousands of failed inspections, hundreds of consumer complaints, and multiple enforcement actions. The complaint alleges that consumers across the country have consistently reported widespread pricing discrepancies, and regulatory inspections have confirmed that price labels are inaccurate in stores across the nation where Family Dollar frequently charged consumers higher prices at the register. The FTC and states further allege in the complaint that Family Dollar charged consumers more at the register than the prices listed on its website and mobile app.
Under the proposed order, Family Dollar would be required to establish a $40 million consumer redress fund for eligible consumers and a $20 million discount program for Family Dollar customers. Payments exceeding $3 million will also be made to the states. Family Dollar would be required to notify customers of their redress fund eligibility by clearly posting notices in its stores and on its digital platforms. In addition, it would be required to establish a pricing accuracy program aimed at ensuring that Family Dollar regularly monitors and verifies its prices, trains employees to identify pricing discrepancies and promptly corrects errors to ensure customers are charged the prices advertised or displayed.
The settlement comes after AG Kaul and a coalition, in a separate and ongoing action, sued Dollar General for alleged deceptive pricing practices.
Joining AG Kaul and the FTC in the enforcement action against Family Dollar are the attorneys general of Alabama, Arkansas, Colorado, Florida, Illinois, Iowa, Kansas, Louisiana, Mississippi, Nebraska, Ohio, Oklahoma, Pennsylvania, South Carolina, Tennessee, and Utah.