Illegal Restocking Fees

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Until recently, computer stores, appliance stores, and electronics stores were the only retailers that charged restocking fees.  However, over the past few years, more and more retailers have begun charging restocking fees.

State law governs whether retailers may charge restocking fees when customers return merchandise.  Generally is those states where retailers may legally charge restocking fees, the customer must be notified of the store's return policies and any restocking fees must be disclosed before the purchase is made.  Restocking fees must be reasonable and may not be so high as to discourage customers from returning defective merchandise.  Additionally, restocking fees must be related to the actual cost of restocking the item.

What is Considered an Illegal Restocking Fee?

Restocking fees may be charged when merchandise is returned in an open box, in a badly damaged box, or without the original box it came in.  Restocking fees may also be charged if merchandise is returned without all the original packaging, instructions, and accessories.  Oftentimes, restocking fees are charged to the customer's credit automatically or are deducted from the customer's cash refund when an item is returned.

There are some instances where retailers charge illegal restocking fees.  Although state laws vary, restocking fees are generally illegal if:

  • They are being charged in connection with the return of defective merchandise;
  • They are being charged because the retailer delivered the wrong merchandise;
  • They are being charged because the retailer failed to deliver the merchandise within the promised time period;
  • They exceed 50% of the purchase price of the merchandise; or
  • The restocking fees are not adequately disclosed to the customer.

To determine whether your state has consumer protection laws which regulate restocking fees, contact your state's Department of Consumer Affairs.

Penalties for Merchants

State consumer protection laws set forth the penalties a retailer may incur as a result of imposing illegal restocking fees on its customers.  In most instances, retailers who violate consumer protection laws and engage in misleading business practices are subject to fines.

Legal Help for Consumers

If you have been the victim of misleading business practices including imposition of hidden fees and illegal restocking fees, you should report it to the Office of Consumer Affairs in your state.  Although the Office of Consumer Affairs in most states does not investigate individual cases, they do gather information and look for patterns of conduct which may evidence illegal conduct on the part of retailers.

If you believe you have been charged illegal restocking fees, you should also contact a consumer protection attorney.  Consumer protection attorneys across the country are investigating the possibility of filing class action lawsuits against retailers for charging hidden fees and illegal fees.  A qualified consumer protection attorney will evaluate your case and recommend a course of action.

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