Fast-food giant Taco Bell has beenPenalties ordered to pay $85,500 after allegedly violating California’s gift card regulations, according to an announcement from District Attorney Carla Rodriguez. The stipulated judgment addresses claims that Taco Bell, along with its subsidiary GCTB LLC, failed to comply with California Civil Code section 1749.5, which pertains to the cash redemption of gift cards with a low balance.
The legal action, initiated in Ventura County with support from the District Attorney’s Offices of Los Angeles and Sonoma counties, accused Taco Bell of denying California consumers their legal right to cash out balances on Taco Bell Gift Cards valued at less than $10. California law explicitly states that retailers must redeem gift cards for cash when the remaining value falls below this threshold. This measure is designed to protect consumer interests and ensure fair practices in the handling of gift card balances.
Ventura County District Attorney Carla Rodriguez stated, “My office is dedicated to collaborating with law enforcement agencies throughout California to uphold consumer protection and ensure corporate compliance with the law.” This case underscores the commitment of California authorities to enforce gift card regulations and protect consumers from unlawful practices.
Under the terms of the settlement, Taco Bell Corporation is mandated to pay a total of $85,500. This sum includes $45,000 in civil penalties, $30,500 to cover investigative costs incurred during the inquiry, and $10,000 allocated for consumer restitution. Crucially, the agreement legally prohibits Taco Bell from future violations of Civil Code 1749.5. To ensure ongoing compliance, Taco Bell is required to implement several corrective measures. These include prominently displaying notices in both corporate and franchise stores, informing customers of their gift card redemption rights and the procedure to claim cash back.
Furthermore, Taco Bell gift cards will now feature a directive to the company’s gift card redemption website. This aims to simplify the redemption process for consumers seeking to cash out their low-balance gift cards as per section 1749.5. In addition to these consumer-facing changes, Taco Bell is also obligated to conduct annual training sessions for store managers and franchisees on California gift card law. To maintain adherence to these regulations, Taco Bell will be required to actively monitor both its corporate-owned and franchised restaurant locations for compliance on an ongoing basis. This multi-faceted settlement aims to not only rectify past violations but also to establish a framework for future compliance and consumer protection regarding Taco Bell gift cards in California.
