Whole Foods stores in New York City have been ripping customers off by overstating weights of some products including packaged baked goods, dairy items and meats according to an investigation by the Department of Consumer Affairs (DCA).
DCA Commissioner Julie Menin said her staff had told her this was the “worst case of mislabeling" they had ever come across.
The Department will be expanding the investigation into other Whole Foods stores.
Whole Foods has nine stores in New York City with plans to open a Harlem location.
Eighty different pre-packaged items were tested in the investigation and all had displayed the wrong weight on the labels. Amounts customers had been overcharged for went from 80 cents for a packet of pecan panko to almost $15 for coconut shrimp packages.
In a prepared statement Whole Foods spokesman Michael Sinatra said "We disagree with the DCA's overreaching allegations".
A DCA statement said the investigation showed that overstating weight for packaged products and overcharging was a "systematic problem" at Whole Foods with packages not routinely weighed or weighed inaccurately.
Some package items showed the exact same labeled weight which would be nearly impossible to occur. These items vegetables, seafood, berries and nuts.
Other cases showed for eight vegetable platters tested with a price tag of $20 per package, customers had been ripped off $2.50 on average; for eight packets of chicken tenders priced at $9.99 per lb, customers had on average been overcharged $4.13; and for four berry packages labeled with $8.58 per package, the price per package was inflated by $1.15 on average.
“It is unacceptable that New Yorkers shopping for a summer BBQ or who grab something to eat from the self-service aisles at New York City’s Whole Foods stores have a good chance of being overcharged,” Menin said. "As a large chain grocery store, Whole Foods has the money and resources to ensure greater accuracy and to correct what appears to be a widespread problem".
Sinatra, the Whole Foods spokesman said the company had cooperated fully with the DCA till it made "grossly excessive monetary demands" to settle the dispute.
"Despite our requests to the DCA, they have not provided evidence to back up their demands nor have they requested any additional information from us, but instead have taken this to the media to coerce us. Our customers are our number one stakeholder and we highly value their trust in us." he said.
Sinatra said Whole Foods' policy had always been to fully refund any items that were found to show incorrect weight or price, adding the company "has never intentionally used deceptive practices to incorrectly charge customers".
Fines for incorrectly labeling a package can range from as much as $950 for a first time violation to $1,700 for a following violation. The number of violations against Whole Foods in the New York city stores amount to thousands.
The DCA regularly inspects all New York City supermarkets .
This isn't the first time the chain has been caught ripping off customers. In 2012 in California Whole Foods paid nearly $800,000 in fines for showing incorrect weights.