For Immediate Release - July 09, 2009

CVS, Shaw's Discuss Plans to Reduce Overcharges with Office of Consumer Affairs and Business Regulation

Officials meet with retailers to continue dialogue on pricing issues

BOSTON - July 9, 2009 - Officials from the Office of Consumer Affairs and Business Regulation and the Division of Standards have met with CVS and Shaw's to discuss the individual companies' plans to reduce overcharges at stores in Massachusetts.

Leaders from OCABR and DOS also anticipate meeting with other retailers that have high rates of overcharging. Overcharging occurs when the price rung up at the register is higher than the posted price on a store's shelves.

"The issue of overcharging is one we are continually investigating and evaluating. Especially in tough economic times, consumers have to be assured that the price they see on the shelf is the price they will pay at the register," said Barbara Anthony, the Undersecretary of the Office of Consumer Affairs and Business Regulation. "We are encouraged by the attention CVS and Shaw's are paying to this issue, and we will work with them and other retailers on this issue going forward."

At their meeting, CVS outlined its plan for increasing vigilance of potential overcharges through new procedures. Along with procedures already in place, CVS will now conduct an internal audit program that will include in-store, weekly price reviews; conduct an external audit program through an outside agency that will randomly audit price accuracy; and will make technology improvements including automatically-generated shelf price labels in stores. CVS will provide an update to OCABR and DOS in 30 days.

Shaw's also met with Office of Consumer Affairs and Business Regulation and Division of Standards officials, seeking guidance as the supermarket chain continues its process of developing a remediation program to eliminate overcharging. Part of that program, at Shaw's request, will include employee training by the Division of Standards. Shaw's anticipates having its plan in place by August.

The Division of Standards has consistently inspected stores throughout the Commonwealth, including investigating potential overcharging incidents. In 2008, DOS conducted 1,246 inspections and found 2,055 instances of overcharging.

"We work in coordination with retailers to ensure consumers are as protected as possible from overcharging," said Charles Carroll, the Director of the Division of Standards. "Along with internal controls on the part of stores, the Division of Standards conducts inspections on a regular basis around the state as we continue to reinforce retailers' responsibilities, and keep an eye out for any trends in overcharging."

The Division of Standards intends to give CVS and Shaw's 30 to 45 days to put their respective plans in place, and then begin a series of inspections to gauge the success of the plans.