Family Dollar has agreed to pay $63 million to settle allegations brought by the Federal Trade Commission (FTC) and 17 states regarding deceptive pricing practices. The settlement follows accusations that the discount retailer charged customers higher prices at checkout than those listed on store shelves, tags, and advertisements.
The legal action, filed by the FTC and a coalition of states including Alabama, Florida, Ohio, and Pennsylvania, alleged that pricing inaccuracies were widespread across the company's network. According to the complaint, the retailer failed to correct these errors despite regular reports from customers who noticed price discrepancies in stores, on the company website, and through its mobile app.
Under the terms of a proposed order, Family Dollar is required to establish a pricing accuracy program that includes regular monitoring and employee training. The company must also undergo independent annual assessments to certify its pricing accuracy. As of Thursday, Family Dollar, which is headquartered in Chesapeake, Virginia, and operates over 7,000 stores, had not responded to requests for comment.
A shopper will also notice a change in store pricing during a mandated two-day promotional period. Family Dollar must offer a 15% discount on a range of goods to satisfy the $20 million discount program requirement. Additionally, customers may see more consistent pricing between shelves and registers due to the new pricing accuracy program, which mandates that employees identify and correct discrepancies. The 17 state plaintiffs will receive a combined $3 million as part of the total settlement.
This settlement follows similar legal action against other budget retailers, such as an ongoing lawsuit filed in October by the FTC and 20 states against Dollar General. The Family Dollar order requires formal certification of price matching. While the $63 million settlement and the terms of the pricing program have been announced, the specific dates for the two-day discount period and the deadline for filing reimbursement claims were not reported.