‘Tis the season for out with the old and in with the new, but if you’re looking for a place to dump those too-tight sweaters and Uncle Frank’s accordion, because let’s face it, you’re never going to get around to taking lessons, you might want to read this before dropping those unwanted items off at a Value Village.
Washington Attorney General Bob Ferguson believes Value Village, the largest for-profit thrift store in the world, has been duping Washington customers for more than a decade with “widespread deception.”
There’s nothing wrong with making a profit on used goods, especially when it relieves overcrowded landfills, but there is something wrong with soliciting those goods under a pretense of charity.
The state’s AG office recently filed a consumer protection lawsuit in King County court claiming Value Village’s advertising scheme leads donors and shoppers to believe the retail thrift store chain is a nonprofit or charity when clearly it’s not.
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Here are a few examples of the company’s ads: “Every time you donate, you help us support local nonprofits,” or “Help your neighbors. Help the world. Shop and donate.”
According to Ferguson’s 37-page complaint, “no portion of Value Village in-store sales benefits its charity partners, and contrary to Value Village’s marketing, for years, some types of donations – including furniture and housewares – did not benefit charities at all.”
There’s a word for that kind of deceptive business model and that word is “scam.” The pretense is similar to campaigns or crowdfunding websites that promise to send money to good causes but only pocket the profits.
The King County Superior Court will ultimately decide if the Bellevue-based company TVI Inc. violated the Consumer Protection Act and Charitable Solicitations Act, but it looks fishy from here.
The Attorney General’s office surveyed 400 Washingtonians and asked them how much profit they thought Value Village donated to charity. The majority of those surveyed thought charities would get one-third or more of an item’s sale price. They weren’t even close. For furniture and home goods, Value Village donated zero dollars until 2015; that’s when the AG’s office began an investigation of the company, and coincidentally, when Value Village began paying charities for some items.
For soft goods, such as clothing and shoes, Value Village donated $0.04 per pound. For furniture and other large items, it paid charities $0.02 per item. The company claims they donated $13 million to Washington charities last year.
A week before the Attorney General filed his lawsuit, TVI filed one of their own, stating their right to free speech was violated when the AG’s office asked them to disclose the percentage of revenue that goes to charity.
The Bellevue company profits from presenting itself as a philanthropic entity, but it doesn’t want the public to know by how much. Meanwhile, donors, under the impression their unwanted items go to a deserving charity, undoubtedly offer up goods that are of high value.
And worse, Value Village siphons clothing and goods away from thrift shops that make a real difference to Pierce County residents, thrift stores like Goodwill Industries, Habitat for Humanity, Hope Furnishings, American Cancer Society and The Arc of Washington, to name just a few.
After a three-year investigation, the Attorney General is asking the for-profit company for $3.2 million to settle, a small amount considering the millions of dollars the company has made deceiving donors and shoppers.
The AG’s office also seeks a court order prohibiting Value Village from misrepresenting themselves again. A penalty of up to $2,000 is being sought for additional violations.
For too long the company that generates over $1 billion annually played on Washingtonian’s generous natures. Shoppers and donors beware.