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Michigan Fraud Laws

Posted by Tamara

Michigan Attorney General Mike Cox recently announced that drugstore chain Walgreens has agreed to pay the second largest fine in state history for its failure to individually price items as required under Michigan fraud laws. 

          Michigan is one of the few states in the union that requires that each individual item be priced, rather than the price displayed on the shelf.  The settlement follows a joint investigation by the Department of Agriculture and the Attorney General’s Consumer Protection Division. The investigation showed that numerous Walgreens’ locations throughout Michigan had failed to individually price items.  Today’s $550,000 settlement is Michigan’s second largest in an item-pricing case.  In April of this year, Cox’s office settled an item-pricing case with Wal-Mart for $1.5 million.

            According to Cox, “Today’s settlement will help to ensure that Walgreens will continue to abide by the terms of Michigan’s Item Pricing Act.  It should also serve as a warning to would-be violators that failure to comply with the act may lead to substantial financial penalties.” 

Cox noted that upon issuance of the Notice of Intended Action, Walgreens worked quickly to come into compliance with the item-pricing law.  “I am hopeful that Walgreens will now be able to set a positive example for other Michigan retailers through its newfound compliance with the Item Pricing Act,” he said.

            Under terms of the settlement, Walgreens will pay $550,000 in penalties and reimbursement for costs incurred by the State.  Walgreens must also maintain compliance with Michigan’s Item Pricing Act.

            Commenting on today’s settlement, Michigan Department of Agriculture Director Mitch Irwin stated, “This action sends a loud and clear message — the State of Michigan will continue its aggressive efforts to investigate and enforce the Item Pricing Act.”

            Earlier this year, investigators from the Department of Agriculture and the Department of Attorney General conducted an audit of six Walgreens’ stores, examining thousands of items in the process.  In addition, the Attorney General’s office conducted a less formal audit of five other Walgreens’ stores.  

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