THE VIRGINIAN-PILOT
Copyright (c) 1995, Landmark Communications, Inc.
DATE: Tuesday, October 17, 1995 TAG: 9510170256
SECTION: LOCAL PAGE: B1 EDITION: NORTH CAROLINA
SOURCE: BY STEPHEN W. DILL, ASSOCIATED PRESS
DATELINE: RALEIGH LENGTH: Medium: 70 lines
The state Department of Agriculture announced Monday it is fining Kmart $25,000 for overcharging customers at five North Carolina stores.
Surprise inspections at the stores turned up 117 instances where customers were overcharged on 1,550 randomly selected items, including a comforter at Kmart's Statesville store that was marked $24.99 but when scanned at a register, sold for $39.99.
The Kmart stores that received penalties are:
Kmart store in Pineville. Inspectors found 41 overcharges from an inspection lot of 300 randomly selected items.
Kmart store on Brevard Road, Asheville. Inspectors found 23 overcharges on 300 items.
Kmart store on Bridford Parkway, Greensboro. Inspectors found 20 overcharges on 300 items.
Kmart store in Statesville. Inspectors found 23 overcharges on 450 items.
Kmart in Elizabeth City. Inspectors found 10 overcharges on 200 items.
``Scanning errors are serious business,'' said Jim Graham, state Agriculture commissioner. ``This discovery is troubling and we plan to continue cracking down on these types of errors. Price accuracy is critical.''
Scanning-error overcharges occur when an item is marked at a certain price, but when electronically scanned at the cash register, rings up for a higher price, said Greg Cook, a spokesman for the Department of Agriculture.
Most of the overcharges were less than $5, Cook said. For example, at Kmart's Pineville store, a ladies' robe was marked $7.69 but scanned for $10.99, and in Asheville, a pair of men's jeans were priced $17 but scanned for $21.99.
``It's troubling because it adds up,'' he said. ``Those $1 and $2 overcharges become $15.''
If 2 percent or less of the items inspected by the state result in overcharges, the state usually issues a warning, Cook said. But nearly 14 percent of the items inspected at Kmart's Pineville store were scanning error overcharges.
``We've had a pattern of troubles with Kmart stores,'' Cook said. ``Maybe it's not being done on purpose, which it could be. But it just may be a case of poor management.''
The state conducted its inspections after receiving consumer complaints and anonymous tips from some Kmart employees.
Kmart officials were warned after an earlier inspection showed a pattern of overcharges and that state inspectors would return. In the subsequent inspections, the currently cited overcharges where found, Cook said.
The Agriculture Department notified the individual stores and Kmart's corporate offices of the fine last week.
Kmart can appeal, but the state had not heard from the retailer as of Monday, Cook said.
A spokeswoman in Kmart's corporate headquarters in Troy, Mich., Monday said company officials planned to meet with state officials, but said she could not comment on the pricing practices at the five stores or the $25,000 penalty.
The inspections were conducted by the department's Standards Division in August and September.
State law allows the Department of Agriculture to assess a maximum civil penalty of $5,000 per violation against any person who ``willfully'' violates the state Weights and Measures Act.
The state could have asked for a temporary restraining order or a preliminary or permanent injunction to prevent the continued scanning-error overcharges observed during the inspections. by CNB