Shell Pays $762K To California For Misleading Payments Advertising
Shell Oil is coughing up more than $762,000 in civil penalties, investigative costs and restitution after being accused of tricking consumers with payments ads for various Shell fuel rewards and gift card programs. The complaint, filed in California Superior Court, said that Shell didn’t properly disclose that gift cards and fuel rewards cards could not be used in combination. Also, charges include Shell pushing 5-cent discounts when paying with a Shell gift card that weren’t always given, limitations to Shell’s rewards programs that were not sufficiently disclosed, and some gasoline stations charging customers the price for credit card purchases even though gift cards were advertised that they could be used as cash and with the cash discount. The complaint also said that Shell failed to redeem gift cards with balances less than $10, which is required by state law. Shell did not respond to a request for comment by deadline.
The case seems to involve unintended false communication, says Robert Hartman, deputy district attorney, Alameda County in Oakland, Calif. “In essence, we brought it to their attention and they said, ‘Your concerns are valid and we’ll do everything we can to correct it,’” he says.
Violations occurred at company and store franchisee levels. “Big Oil has gotten out of retail petroleum sales. To Shell’s credit, they stepped up and said that Shell will ‘do our best to educate our wholesalers,’” Hartman tells Paybefore. Wholesalers are authorized to sell Shell-branded gasoline directly to consumers or to authorized Shell retailers.
As part of the settlement, Shell must “clearly and conspicuously” disclose details of Shell promotional programs and card products on its Website as well as at store locations, such as on pump and register toppers, counter mats and any print materials for newspapers and magazines, according to the final judgement. Additional stipulations include providing training materials to help retailers address the issues in the complaint and communicating annually with Shell stations about California law requiring retailers to allow consumers to redeem their Shell gift cards for cash when the value is less than $10.
As part of the more than $760,000 settlement, Shell will pay each of seven counties $80,000 in civil penalties. In addition to Alameda, the other counties involved were Monterey, Napa, Santa Clara, Santa Cruz, Solano and Sonoma.
“Shell cooperated and they deserve attention and credit for stepping up,” Hartman says. “All we’re asking for is a level playing field.”