Top Pot Bakery, which was found to have been using artificial flavorings despite touting itself as selling only all-natural products, has agreed to pay refunds to all of its customers since the company started in December 2010, providing they have receipts or other proofs of purchase.
The bakery chain reached an agreement with Taipei consumers’ rights and legal affairs officials yesterday, promising the refunds based on uniform invoice receipts, credit card proof of purchase or store membership data.
Apart from the refund, each customer who claims a refund will also receive a gift coupon valued at 25 percent of the total amount he or she has spent on Top Pot baked goods.
For those unable to provide proof of their purchases, the bakery, which has 21 stores in Taiwan, Shanghai and Hong Kong, has agreed to launch a 10-day, 25 percent discount sale for all customers at some point after it reopens today following a three-day closure, according to the agreement.
The incident was described as regrettable by the Taipei city officials who attended talks with representatives of the bakery, which was accused by Taipei Mayor Hau Lung-bin (郝龍斌) on Saturday of deceiving consumers after it was found to be using artificial flavorings in bread it claimed to be free from non-natural ingredients.
Hau instructed the relevant authorities to collect evidence of the company’s alleged false advertising for reference by prosecutors and police investigating the case, and to negotiate with the company over refunds and compensation for causing food safety concerns.
Tsai Li-wen (蔡立文), head of the city’s Department of Legal Affairs, yesterday said the city government felt that despite the agreement, the company had failed to make consumers’ rights and benefits its top priority.
He urged Top Pot Bakery to reconsider its compensation plan and encouraged anyone dissatisfied with the refund and compensation offer to file a complaint with consumers’ rights officials.
The city government team had sought a payout of three times the amount of money a customer had spent on products for each refund claim, but this was rejected by the company, which said that such an amount would leave it facing bankruptcy.
Top Pot Bakery International Co chairman Hsu Hsun-ping (徐洵平) told reporters yesterday that the city government’s suggested compensation would cost the firm several hundred million New Taiwan dollars.
“We would have to shut down tomorrow” if the company were to compensate consumers to that extent, Hsu said.
Taipei District Prosecutors and police conducted a search of Top Pot’s central kitchen in New Taipei City (新北市) yesterday, as well as searches of the company’s flavoring suppliers, a day after they raided the bakery’s flagship store on Taipei’s Dunhua S Road, where they seized more than 10 kinds of artificial flavoring.
Last week, the company was fined NT$180,000 for falsely advertising its products as “natural.”
Prosecutors on Saturday began to investigate allegations of fraud against the bakery, and the following day named former Top Pot Bakery International chairman Chuang Hung-ming as a defendant. He was released on bail of NT$1 million (US$33,400) and handed an overseas travel ban.
Hsu, who took over as chairman earlier this month, also filed a lawsuit against Chuang on charges of fraud and breach of trust at the Taipei District Prosecutors’ Office yesterday.
Calling himself a victim like every customer who likes Top Pot’s products, Hsu said his decision in March last year to buy 60 percent of the company’s shares, which until then had been wholly owned by Chuang and his team, was based on the company’s claim to only use natural ingredients, adding that he had no knowledge of the recipes being used.