Closet World Inc. in Whittier, settling a civil lawsuit by Orange County prosecutors, has agreed to pay an $80,369 fine and to stop advertising products on sale that were never offered at higher prices.
The district attorney's office said so-called continuous sales mislead shoppers who believe they are getting bargains when none exist. The consumer fraud division is investigating at least two other companies for similar violations, Deputy Dist. Atty. Wendy Brough said Thursday.
Prosecutors alleged that Closet World continuously offered closet remodeling products and services at a 35% discount off list prices, Brough said, "but there was no list price."
Prosecutors also alleged the company created a false sense of security by issuing sale coupons with expiration dates and, by the time they expired, issuing new coupons with later expiration dates.
Closet World has maintained that other companies advertise even greater savings on products and services that are never offered at higher prices, she said.
Executives could not be reached for comment, but Brough said the company cooperated with prosecutors.
"With continuous sales, consumers forgo comparison shopping because they think they're getting a great deal," Brough said. "The message in all this is to get the prices, even sale prices, and compare" them with prices at other stores.