Tuesday, December 15, 2015

Consumer Investigation: Major Retailers Use Fake Sale Practices

Red Sale Tag Isolated On WhiteConsumers love a good bargain, but sometimes a good deal is too good to be true.

Many bargain-hunting shoppers, convinced that they have saved money by purchasing an item for an advertised sale price, have later discovered the purchased “bargain” products have never really been sold at full price and were fake sales.

According to an almost year-long investigative study conducted by Consumers’ Checkbook, many popular retailers have been found to use deceptive sale pricing practices.

Checkbook tracked seven major stores online once a week beginning in June 2014 on six to 10 “big-ticket” items at each store. Reportedly, some of the items were offered at sale prices for the duration of the investigation – 40 out of 44 weeks.

For example, one of the chains was found to have offered items at sale prices almost always and even when they were sold at regular prices, the items were still listed as being “on sale” with the item’s regular price omitted.  This type of fake sale misleads customers into thinking they are getting a great deal, when in actuality the opposite is occurring.

The report names big-brand retailers Best Buy, Target and Macy’s among the chains that allegedly participated heavily in these disturbing pricing policies.  A summary of their findings include:

Macy’s:  There was one item that was marked on sale almost all of the time and four items were on sale 70 percent of the time, according to Checkbook constitutes deceptive advertising techniques.

Best Buy: The investigation showed that two items were listed as on sale about half of the time while other items were listed at sale prices one-third of the time or less.

Target:  Checkbook noted that items were advertised at sale prices nine percent to47 percent of the time.

Deceptive Pricing Laws

The FTC’s Guide Against Deceptive Pricing generally states that in order for an item to be offered on “sale,” the former price must be “the actual, bona fide price at which the article was offered to the public on a regular basis for a reasonably substantial period of time.”

Various states have laws that are more specific and may dictate, for example, exactly how long a product can be on sale before it must return to a regular price. Over the past few years, there has been an increase in challenges involving these types of laws.

Fake Sale Lawsuits

Macy’s, Best Buy and Target have come under increasing scrutiny for their alleged fake sale pricing.

Currently, Macy’s is facing two lawsuits in California over practices of promoting its merchandise as being heavily discounted. These lawsuits and investigations claim that fictitious discounts mislead shoppers into thinking they are getting bargains that are in fact fake.

Advertising merchandise as on sale when it is never sold at the “original” or “MSRP” price is against the law. If you purchased merchandise at a California retailer, you may have a legal claim.

Join a Fake Sale Class Action Lawsuit Investigation

If you purchased an item on sale at one of the following retailers in California, you may qualify to join a free class action lawsuit investigation:

  • Best Buy
  • Kohl’s
  • Target
  • Tiger Direct

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