Shock horror! Supermarkets are run by capitalists intent on maximisng profit a any tuen and ignoring accounting rules. Let's go back to teh
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Shocking supermarket scandals
John Fitzsimons
20 December 2017
The most shocking supermarket scandals
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Some of our biggest supermarkets have been embroiled in some of the biggest scandals in recent years.
Tesco's accounting 'black hole'
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In 2014, Tesco was at the centre of a dramatic accounting fraud. The supermarket declared that it had discovered a £250 million ‘black hole’ in its accounts, which had led to it significantly overstating its profit forecasts.
Tesco's accounting 'black hole'
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Eight senior executives left the company following the revelation, with three - John Scouler, Carl Rogberg, and Christopher Bush - currently on trial for fraud by false accounting and fraud by abuse of position. Tesco’s UK arm was fined £129 million by the Serious Fraud Office, as well as being ordered to pay compensation worth as much as £85m to shareholders and bondholders after the Financial Conduct Authority declared Tesco had committed market abuse.
Fiddled safety dates
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Earlier this year an investigation by the Guardian and ITV News revealed that one of the largest suppliers of chicken to UK supermarkets had been tampering with food safety dates. This could result in customers innocently eating out of date meat products and becoming ill as a result.
Fiddled safety dates
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Marks & Spencer, Aldi and Lidl swiftly announced they were suspending buying chicken from the 2 Sisters Food Group’s plant in West Bromwich, while the Food Standards Agency has launched its own investigation into the scandal.
The small store rip-off
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Not everyone lives near a giant supermarket – sometimes it’s just more convenient to pop into one of the smaller ‘express’ or ‘local’ stores from the same supermarket brand to pick up your shopping. You’d imagine that the price you pay will be the same, whether you’re buying that bread and milk in a superstore or a small branch – it’s the same supermarket, after all. But that’s not the case.
The small store rip-off
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An investigation by the Daily Mail this year found that shoppers are being charged up to 23% more when shopping in a small store rather than a large one. For example, the price of freshly squeezed orange juice at M&S jumps from £1.50 to £1.85 depending on the size of the M&S, while 250g of red Leicester cheese ranges from £1.70 to £2 if you go to a Sainsbury’s Local rather than a superstore.
Misleading promotions
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The Competition and Markets Authority launched an investigation into the way that supermarkets present price promotions following a super-complaint from consumer champions Which? back in 2015. Which? highlighted the confusing and inconsistent way supermarkets use things like discounts and multi-buy offers, arguing that they were duping shoppers into spending more.
Misleading promotions
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The CMA agreed that some supermarket promotions “could mislead customers”, and expressed particular concern about Asda. As a result, Asda agreed to ensure that multi-buy offers will always represent better value than a single product before the offer, as well as making it easier to actually compare the previous and current offer price.
Spamming marketing emails
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Earlier this year, Morrisons was fined £10,500 for breaking the law on how people’s details should be treated when sending marketing emails. The supermarket was found to have sent more than 130,000 marketing emails to people who had specifically opted out.
Spamming marketing emails
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The emails were sent out in October and November 2016, and were related to Morrison’s loyalty scheme, More Points. Deputy Commissioner Simon Entwisle said: “It is vital that the public can trust companies to respect their wishes when it comes to how their personal information is used for marketing.”
Dairy price fixing
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Sainsbury’s, Asda, Tesco and Safeway (now part of Morrisons) were fined £50 million following a dairy price-fixing scandal which was first revealed in 2007. A probe by the-then Office of Fair Trading found that the supermarkets, along with several major milk dairies, had colluded to fix the price of milk, cheese and butter.
Dairy price fixing
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The investigation found that the supermarkets had pocketed an additional £270m from shoppers as a result of the price fixing, charging them 3p extra for a pint of milk, 15p extra per quarter-pound of butter and 15p per half-pound of cheese. Tesco was the only firm involved which did not admit any wrongdoing.
Carrier bag scandal
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Since October 2015, supermarkets have been required by law to charge 5p for all single-use carrier bags. The idea is that the money raised is then donated to charity. However, not all supermarkets have quite embraced the spirit of this change, with Tesco confirming this year that it had pocketed £3.4 million of the £32 million it had raised, in order to cover ‘admin costs’.
Carrier bag scandal
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Tesco has now scrapped the 5p bags, replacing them a 10p ‘bag for life’ instead. The supermarket was criticised by Labour MP Mary Creagh, who said: "The money from the 5p bag charge should go to good causes. Tesco is back in the spotlight for doing the wrong thing.”
Out of date offers
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It can be hard to resist an attractive multi-buy offer at the supermarket, but how many of us actually check our receipt when leaving the till to ensure that we got the promised discount? An investigation earlier this year found that Tesco was guilty of advertising out-of-date promotions, meaning shoppers actually spent more for their groceries than expected.
Out of date offers
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The BBC’s Inside Out programme visited 50 stores over a three-month period in the West Midlands, Liverpool and Leeds. Expired offers were found at 33 of those stores, with some offers being advertised months after they had finished.
The gluten-free rip off
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Many supermarkets have special product ranges designed to appeal to shoppers looking to avoid gluten. The trouble is, they seem to be using this as a chance to milk shoppers of extra cash, ramping up the price of their ‘free from’ ranges compared to similar products, which also don’t contain gluten but aren’t part of the specialist line.
The gluten-free rip off
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An investigation by Channel 4’s SuperShoppers programme found that Sainsbury’s 300g 'free from' tomato and basil soup was retailing at £1.50. Yet its basic tomato and basil soup, which has no gluten in it, was being sold for just 50p.
Comments
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Another rip-off is Tesco allowing individual stores to charge more for groceries than they charge online. E.g a pack of 4 Cadbury Flakes was £1 online instead of the normal price of £1.79 but the Tesco Extra store at Hanley was charging £1.99. Tesco's attitude when I queried this was to say that individual stores can charge what they like. Other supermarkets are probably doing the same thing.
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20 December 2017