Clothing Retailer Zara Accused Of Ripping Off Customers

LOS ANGELES (CBSLA.com) — An international clothing store loved by celebrities and shoppers is being sued of cheating its American customers.

Zara is facing a federal class-action lawsuit that accuses the retailer of unlawful pricing by tricking shoppers with conversion rates.

"I think their conduct was intentional, deceitful, motivated by greed," said Ben Meiselas, attorney with Geragos & Geragos.

Meiselas represents the plaintiffs and accuses Zara of "bait and switch." He says many items are priced in euros, and when those prices are converted at the register, the customers are overcharged.

"So, where the lowest tag price would be, let's say 9.99 in euros, they were charging 17.99 in dollars and telling the consumer once they got to the register that was due to a conversion error and conversion rate change," Meiselas said.

Meiselas says Zara was manipulating conversion rates and has been cheating customers out of billions of dollars. The multinational retailer is also accused of cover-up pricing where stickers with a dollar price covered up a lower euro price. Customer Chloe Jung showed CBS2's Rachel Kim the tag on the shirt she just bought.

"So, this is dollars, 25.90, then you peel off this price tag, and you can see 17.95 in euros."

Zara USA issued a statement denying the allegations and saying they look forward to presenting a full defense.