Two Democratic lawmakers are calling for an investigation into the grocery store, saying it may be overcharging customers.
Sen. Elizabeth Warren (D-Mass.) and Rep. Adam Schiff (D-Calif.) sent a letter to the Federal Trade Commission and Department of Agriculture on Sunday urging the agencies to ensure that “major grocery chains… False and misleading claims regarding bulk food products may result in customers paying more than they expected for groceries.
Both senators are from overwhelmingly Democratic states and are on this year’s ballot. Warren is likely to be re-elected, and Schiff, currently the senior member of the House of Representatives, is seeking a seat as California’s junior senator.
Their moves in their electoral homelands are unlikely to trigger short-term government action, especially if Republicans retake the White House. This follows a number of efforts by the Biden-Harris administration to pressure grocery sellers to lower prices and Vice President Kamala Harris’ plan to curb excessive food price increases if elected. It is something. She and former President Donald Trump have each sought to convince voters that they are focused on lowering the cost of living in elections where affordability is a top priority.
The letter states that California prosecutors say Albertsons and its subsidiaries Safeway and Vons “unlawfully charged customers prices higher than the lowest advertised or posted prices” for produce, meat, baked goods and other products. The company is referring to a lawsuit alleging mislabeling of products sold by weight.
The lawsuit was settled for $4 million in early October, with Albertsons denying any wrongdoing, but Warren and Schiff said they were not concerned about the possibility of “similar predatory pricing practices across the country.” He said he believed the matter merited further scrutiny.
“Too often, large grocery companies use their significant market power to drive up prices on essential goods and take advantage of customers,” the letter said. Four other senators and 10 additional representatives — all Democrats, plus Sen. Bernie Sanders, R-Vt. — also signed on to it.
Albertsons, the FTC and USDA did not immediately respond to requests for comment.
Warren has previously accused grocery chains of taking advantage of shoppers, saying at a Senate hearing in May that “grocery prices are going up because of good old-fashioned corporate price gouging.” He believed that the reason for this was that “a small number of companies control products at all levels.” food chain. ”
In Sunday’s letter, she and Mr. Schiff said Albertsons may have violated federal law by engaging in “unfair or deceptive acts or practices” prohibited by the Federal Trade Commission Act. said. The company also said it may have failed to disclose the appropriate quantities of certain products, as required by the Fair Packaging and Labeling Act.
Following the California settlement, Albertsons said it would ensure price accuracy, install signage and conduct additional training to “further ensure real-time accuracy in our stores.” Price disputes aren’t Albertsons’ first trouble this year. In February, the FTC filed a lawsuit against grocery giant Kroger to block its acquisition of Albertsons, arguing that the agency would “eliminate competition and raise grocery prices for millions of Americans.”
The Biden-Harris administration has argued that the proposed merger would reduce competition, raise costs for consumers and squeeze wages for grocery store workers. The companies counter that the partnership would be counterproductive and make them more competitive with rivals such as Walmart, Amazon and Costco. Kroger pledged this summer to reduce the price by $1 billion after the deal closes, if it is allowed to proceed.
During the recent inflation, food prices have become one of the biggest concerns for households. Grocery prices soared 20% between January 2021 and December 2022, with some consumers cutting back on common purchases such as red meat and eggs. But inflation is now effectively back to normal. From November 2023 onwards, food prices will increase by less than 2% per year.
Still, many people still feel like they’re living in an era of inflation, a recent Bank of America survey found. While average hourly wage increases have outpaced inflation, many people are living paycheck to paycheck and spending a large portion of their income on necessities.
Concerns about potential price gouging at supermarkets, including Kroger and Walmart, have also been heightened by the proliferation of in-store electronic price tags and the “dynamic pricing” they enable. The companies say the tags allow employees to change prices up to every 10 seconds, streamlining operations and allowing faster replenishment.
But Warren and Schiff also addressed Kroger’s technology in their letter, saying it could enable the company to “inflate food prices and exploit consumers,” Warren said. also raised concerns in a letter to the CEO of the Kroger chain in August.
Kroger denied the claims and said electronic pricing is only used to keep prices as low as possible.
