consumer protection

Best Buy Settles $633,500 Case Over Return Policies

NBC 7 Responds looked at the settlement and how the store's alleged policies affected San Diegans

NBC Universal, Inc.

Best Buy approved a more than $600,000 settlement in a case over it's prices and return policy. San Diego's District Attorney Summer Stephan along with the DA's from several other counties claimed the store's return policy was hurting customers.

"They have to inform the public accurately as to their return policy," said Stephan. "They didn't honor their own advertising about their own return policy, but they also violated consumer laws."

Three years ago, NBC 7 Responds had reported that some customers were "blacklisted" by a company hired by Best Buy to determine who was incorrectly returning items.

"They had this strange monitoring where they decided on a sort of an algorithm who they would grant a refund for and who they wouldn't," said Stephan. "You can't reject people for a refund based on some algorithm that they meet or don't."

Best Buy stopped using that company, but the problem they were trying to solve is very real. Miro Copic, a Marketing Professor at San Diego State University, says the retail industry loses around $10 billion a year in returns.

"The issue for retailers is that less than 50% of returns can be resold for full retail value," said Copic. "They keep track on a database and they look at the analytics for the purchase pattern of these consumers."

Usually, stores do this by scanning your driver's license or ID so the system can tell them if you are approved for a full refund or only for store credit. Copic says this is perfectly legal to do, but stores have to let you know.

"So from a consumer protection perspective, that's why there's a lawsuit," said Copic. "All retailers do it in some way shape or form, but it's what they disclosed."

San Diego is receiving more than $130,000 of the settlement which Stephan says will be used to enforce consumer protection laws.

"Each return should stand on its own," said Stephan. "That's what our consumer laws are."

We reached out to Best Buy for a statement about the settlement but did not hear back by time of publication.

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