I-Team: Local business caught rounding up register receipts
CRANSTON, R.I. —
A bag of coffee beans is dropped into a grinder.
The aroma of a fresh brew, so pungent. Deliciousness fills the cup, drip by drip.
It's what gets the drowsiest of coffee drinkers going in the morning. And the routine can be as comforting as the taste.
At Brewed Awakenings, a popular chain of Rhode Island coffee houses, there are no empty cups, no shortage of customers lining up at four different locations.
But behind the percolating carafes, a practice of fuzzy math, that confused some customers.
NBC 10 I-Team Reporter Parker Gavigan: "They're rounding up to the nearest nickel?"Woman customer: "Up to the nearest nickel. Never down. This is the only business that I've come across that takes it from you without you even knowing about it."Gavigan: "So the customer does not even know this is happening?"Woman customer: "Does not know."
She likes their coffee and wants to continue going back to Brewed Awakenings, so NBC 10 has agreed to hide her identity.
But the customer did file a complaint with the Rhode Island Attorney General's consumer protection unit. Her claim was backed up by more than a dozen receipts the I-Team combed through. Whether you bought a large or medium cup of coffee, a small cappuccino, or a bag of espresso beans - it didn't matter. The bill was always rounded up to the next nickel at all four of the coffee house locations.
Here's an example -- a tab of $5.10 should cost the customer $5.51 after taxes. But the register rounded up to $5.55.
"So they're deceiving the customer, not giving full disclosure as to what they're doing with that money and I think the customer has every right to know where that extra money is going," said Johnson and Wales business professor Melanie St. Jean.
"Pennies are still a used currency in this country and until they're phased out, you should be charged to the exact penny and not round up to the nearest nickel," said Rhode Island Tax Administrator David Sullivan.
Gavigan: "The argument could be we're just talking about pennies here."St. Jean: "Pennies add up and if you add 100 transactions per day, times a couple of pennies, times a number of stores where it's happening, 365 days."
NBC 10 went to Brewed Awakenings owner David Levesque for answers.
"If it's skimming a nickel or a penny off somebody, that's not what we do. We have fair pricing. This was an honest mistake," said Levesque, who says he put a rounding policy in place some 10 years ago to avoid the hassle of using pennies.
But he says the computer system was supposed to round conventionally, both up and down.
The switch to rounding only up, he says, likely happened during a computer upgrade in January of 2012, but he couldn't say for certain.
Hours after the I-Team called him, Levesque quickly corrected his computers in all four stores. There is no more rounding up or down at Brewed Awakenings registers.
Gavigan: "There are people that are going to find it hard to believe that you're the owner of this business and didn't know that this was happening.Levesque: "We do apologize. I take full blame for not seeing, not catching it, not paying attention to it."
The woman customer, who wanted to remain anonymous, filed her complaint on March 14, 2013, according to a copy of the complaint.
"This is a good lesson for everyone. You should always ask for your receipts and you should always check your receipt," she said.
Had Brewed Awakenings posted a sign, alerting customers that they were in fact rounding, there likely would have been no deception here.
The company is offering customers a 5 percent discount on all products May 6-7 as a way of apologizing.