Walmart accused of shortchanging customers on gift receipt returns

Walmart accused of shortchanging customers on gift receipt returns

PORTLAND, Ore. - An undercover investigation by the Problem Solvers reveals a major retailer may be shorting customers money when they try to return merchandise with gift receipts. 

A gift receipt does not display the purchase price for merchandise, but it should allow the gift recipient to return the product for a full refund of the price that the buyer paid.

KATU Problem Solver Shellie Bailey-Shah put gift receipt policies at Walmart, Target and Fred Meyer to the test.

In early October, she purchased 10 Halloween items from Walmart, knowing these same items likely would go on sale after the holiday. She also bought ghoulish garb at Target and Fred Meyer.

After Halloween, she returned with the gift receipts.  At Target, she spent $31.98, and when she returned the merchandise, she was refunded $31.98.  At Fred Meyer, she spent $51.06, and with the gift receipt, she was refunded the full amount, $51.06.

But when she returned to the Walmart store in Cornelius with the Halloween goodies, it was no treat. The cashier at the return counter tried repeatedly to scan each of the 10 gift receipts. She told Bailey-Shah that gift receipts "never work," and that the "system always has trouble with them," a statement Walmart has since disputed.

So instead, the clerk scanned the products' bar codes which brought up the sale price of each item. She told Bailey-Shah that she'd have to manually make adjustments, but somehow Bailey-Shah still didn't end up with all her money. She spent $92.69 but was refunded $79.21. Walmart pocketed $13.48.

The Problem Solvers wanted to know whether this was an isolated incident. It turns out customers in Sacramento, Calif. have been shorted, too.

A news crew from KOVR-TV made three visits to three different Walmarts around Valentine's Day, Saint Patrick's Day, and Easter, buying items they knew would go on sale after each holiday.

In all, the crew spent $51.82.

In those cases, the physical gift receipts did scan, but the crew still was only refunded $26.99. Walmart kept $24.83.

News crews in Dallas and Philadelphia had the exact same experiences.

And in September it happened again in Sacramento with summer shorts. One of the three Walmarts tested only refunded the sale price, shorting the news crew $4.87.  The other two stores processed the returns correctly.

In the case of the Cornelius store, Walmart spokeswoman Ashley Hardie wrote in a statement to the Problem Solvers, "There appeared to be a scanning issue that required our associate to process the return differently. We take these matters seriously and apologize for any inconvenience... It's our expectation to refund the original purchase price when returning an item with a gift receipt... We are reviewing that process to look for ways to make it more efficient and reliable for our customers."

"That's out and out theft," California Sen. Barbara Boxer told lawmakers who'd gathered for a congressional confirmation hearing of Federal Trade Commission Chair Jon Leibowitz last week.

After the initial reports in May of gift receipt problems at Walmart, Boxer wrote two letters to the Federal Trade Commission, demanding an investigation.

After Bailey-Shah contacted her office last week, Boxer renewed her plea to Leibowitz.

"I would hope that in the near future, we'd see a response from you on this. It's very disturbing," said Boxer.  "It's just like someone is going and picking somebody's pocket. It's just the same deal."

"Certainly, this scheme has been going on for a long time," said Bill Kershaw, a California consumer attorney.

Kershaw has now filed a class action lawsuit against Walmart over the gift receipt discrepancies. As part of the suit, he is asking the retail giant to turn over records tied to billions of returns over the past few years.

"That electronic information we believe is available and if it is, we should be able to find out how much has been overpaid and the people who have overpaid it," said Kershaw.