Is ZARA Overcharging US Customers? Allegations of Price Gouging

A ZARA store 

Next time you visit ZARA check the price tags and the currency conversion from EUROs to US dollars on your items carefully.  There are new allegations that ZARA is overcharging their US customers by charging US customers inflated prices in US Dollars, rather than the true retail value of an item’s price in EUROs.   Think about that.  When is the last time you used your currently calculator at ZARA to check those EURO prices? My favorite guilty pleasure, the Daily Mail is exclusively reporting that European fashion retailer ZARA may be indulging in deceptive pricing practices.

A $5million class action suit brought by Devin Rose against ZARA alleges that the retailer,  has knowingly deceived US customers into paying more than the true US converted retail price of their EURO price tagged goods.   If it’s true, this is horrible.  How long has this been going on? I have no idea, but one thing I have noticed is that ZARA’s prices have increased since the chain expanded their US store chain, while, in my opinion, the quality of their goods has declined.  Images from the legal documents illustrate how the ZARA price tags are deceptively marked.

A page from the ZARA class action lawsuit via Daily Mail showing how ZARA affixes inflated US prices over the EURO prices.

Well known Los Angeles Attorney  Mark Geragos filed the lawsuit.   The legal complaint states that  ‘Zara’s practice of assuring consumers that the discrepancy between the tag price in euros (€), and the dollar ($) price at the register is merely the result of an appropriate application of the conversion rate from euros to dollars.

‘In fact, the conversion rate is entirely misapplied – to the extent it is even applied at all – such that U.S. consumers are paying far more than the true prices of the products.’

In this exhibit, the legal document show how a Euro priced item of ‘€9.95’ is converted to $17.90 when the actual exchange rate should have been $11.26 each.

Suddenly it seems that those ZARA prices aren’t such a good deal after all.  Bottom line: Buyer beware when you shop at ZARA.  We’ll keep you posted as this lawsuit evolves. One thing is for sure, ZARA has to hate the negative publicity of  the Daily Mail picking up the court documents filed in California.   ZARA fans are already leaving negative comments on the large ZARA Facebook group letting other consumers know about the issue.  Will ZARA settle this or let it go to trial?