Taco Bell has agreed to pay a hefty price for alegedly breaking gift card laws in California.
The fast food chain was accused of refusing to cash out customers’ gift cards if the balance was under $10, forcing foodies to discard their unusable funds.
Driving the news: California state law dictates that if a customer’s gift card balance is under $10, they are legally allowed to redeem it for cash instead of using up the remaining balance. A settlement in litigation initiated byLos Angeles District Attorney George Gascón was reached on June 15, and includes $45,000 in penalties and $30,500 in investigative expenses.
- As part of the settlement, Taco Bell will be required to post a sign near each register in every store informing customers of the cash redemption policy for restaurant gift cards under $10. The chain is admitting no wrongdoing, but all future Taco Bell gift cards will be printed with a link to the redemption website for more information.
- $10,000 of the fine will be allocated to the California Consumer Protection Prosecution Trust Fund to help protect consumers from similar issues in the future.
- This fine arguably sheds a less flattering light on the playful “for the people” messaging the fast food chain has been conveying lately, such as launching a petition to reclaim “Taco Tuesday” as a public domain phrase and partnering with LeBron James for an ad campaign in support of the effort.