Home Depot to pay $2 million settlement for overcharging shoppers

Home Depot has agreed to pay $2 million to settle a legal claim that it was overcharging its customers. 

The DIY giant was accused of engaging in false advertising and unfair competition in a lawsuit bought by California district attorneys.  

The case argued that Home depot customers were being charged more at checkout than the item was advertised for on the shelf or item tag in so-called 'scanner violations.'

Now Home Depot has opted to settle the case, admitting no wrongdoing but paying $1.7 million in civil penalties.

The settlement also cost the company $277,251 for investigation costs and to go towards 'future enforcement of consumer protection laws.' 

But there is no compensation that will go directly to shoppers who were affected. 

The judgement also ruled that the company must bring in a 'price accuracy program' to avoid future discrepancies. 

This will include more audits of prices, staff training and a ban on  price rises on weekends. 

'False advertising and unfair competition are serious offenses that undermine consumer trust and distort the marketplace,' Los Angeles County District Attorney George Gascón said in a statement. 

'When companies engage in deceptive practices, they not only cheat consumers but also gain an unjust advantage over businesses that operate ethically and transparently.' 

It comes just weeks after Home Depot sparked fears that it could face setbacks after it posted weakened earnings for the second quarter and issued a concerning warning about the economy last month. 

CFO Richard McPhail told analysts that consumers were spending less on big home projects due to a 'sense of greater uncertainty in the economy.'

Homeowners are feeling the pinch of higher mortgage rates and years of inflation that have battered their budgets, McPhail said.

Walmart was also recently caught out overcharging its customers and was forced to shell out $45 million to settle a class-action suit. 

The lawsuit accused the grocery giant of charging shoppers for more than they should have done for certain bags of citrus fruit or packs of meat.

Firstly, it is said to have inflated the product weight of the meats and seafood when they were scanned at the register.

Secondly, it is alleged to have mislabeled the weight of the bags and nets of citrus fruit. The lawsuit says the weight of the fruit was less than it was labelled as.

Thirdly, the retailer is accused of charging too much when these items were put on sale for clearance, for example when they were close to being out of date.

Customers that bought the items between October 19 2018 and January 19 this year can claim up to $500 by a filing in a form online.