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Japanese fleece retailers

The reputation of ordinary Japanese as scrupulously honest took a dent yesterday when major supermarket chain Seiyu Ltd said customers had duped it into refunding three times the money it earned from selling mislabelled meat at two of its stores.

Seiyu said it began refunding money to customers -- without requiring them to show receipts -- in mid-September after it found imported beef and pork had been labelled as domestic to fetch higher prices for a year at two stores.

As news of the easy money spread across the Internet and by word of mouth, hundreds of "customers" flocked to the stores demanding refunds, despite staff suspicions many of them had never visited the shops before, the company said.

As of Monday, Seiyu said it paid out about ?66 million (US$545,000) to a total of 1,930 people, three times the ?21.2 million in sales it made on the products in question, before terminating the giveaway.

"We thought there would be people who had purchased products and others who hadn't" coming for the refunds, said Seiyu spokesman Ryuichi Goto.

"But we took our stance with the honest ones in mind," he said adding the company never imagined so many people would cheat.

"We deplore the morality of these customers," Goto said.

Newspaper reports described the majority of individuals in the unruly crowd that gathered at Seiyu's Motomachi store in the northern city of Sapporo as in their 20s and 30s, with dyed hair and pierced ears or chins -- not considered typical supermarket shoppers.

Two 19-year-old men were arrested after punching, kicking and yanking the necktie of a Seiyu security guard, local police said.

"One of them said he had never bought meat at the store, but he heard if he came he could get money," said officer Nichio Anzai.

Retail analyst Toshiko Binder from HSBC said the "careless" giveaway by Seiyu, now in the midst of being taken over by US giant Wal-Mart Stores Inc., was symptomatic of the ailing sector in a deflation-wracked economy.

"There are so many bad issues over the safety of food and the problems and they wanted to make sure that their customers would not get so disappointed with them," she said.

Last September, Japan discovered Asia's first case of bovine spongiform encephelopathy (BSE) or mad cow disease, triggering a beef scare that sent prices plummeting.

After one now defunct meat processing company, Snow Brand Foods Co Ltd admitted mislabelling meat to take advantage of government refunds earlier this year, the Japanese media have elevated any mislabelling case into a major scandal.

"At least they responded very quickly to this and they responded to make sure that their customers won't get ripped off from this. Maybe they went too overboard," Binder said.
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