Barneys to pay $525K fine to settle racial profiling charges

August 11, 2014, 4:26 PM UTC
(FILES) The front window of Barneys New
(FILES) The front window of Barneys New York is seen on Madison Avenue in midtown Manhattan 06 August 2007. The Gulf emirate of Dubai is making headlines with a series of high-profile investments abroad in everything from aircraft builders to Las Vegas casinos, but some deals are financially risky and could even spark a protectionist backlash, economists say. Government-controlled or backed firms and investment funds have chased strategic targets such as European aerospace giant EADS, owner of Airbus, in which Dubai International Capital bought a 3.12-percent stake, and brand names like the upscale Barneys New York retail chain, which Istithmar, another investment arm of the emirate, wrested from a rival Japanese bidder. AFP PHOTO/TIMOTHY A. CLARY (Photo credit should read TIMOTHY A. CLARY/AFP/Getty Images)
Photograph by Timothy A. Clary — AFP/Getty Images

Barneys New York has agreed to pay $525,000 to settle accusations that the luxury emporium disproportionately targeted minorities shopping at its Madison Avenue flagship and will overhaul its detention policies and give staff more training, in the hopes of getting closer to ending an embarrassing episode.

The settlement with New York State’s Attorney General Eric Schneiderman is the culmination of a nine-month investigation stemming from accusations by two black shoppers that they were falsely accused of credit card fraud while shopping at Barneys last year. Several customers and former employees complained to the Attorney General’s office that some store guards systematically singled out minority shoppers for extra scrutiny including following them around, and that in-store detectives disproportionately asked sales staff who handled minority customers’ transactions to inquire about their credit card use.

In addition to the fine, Barneys will retain an anti-profiling consultant for two years, adopt new anti-theft detention policies and give staff more anti-profiling training.

“This agreement will continue our work to ensure there’s one set of rules for everyone in public accommodations, including customers in New York’s retail establishments,” Schneiderman said in a statement. “This agreement will correct a number of wrongs, both by fixing past policies and by monitoring the actions of Barneys and its employees to make sure that past mistakes are not repeated.”

In February 2013, 21-year-old nursing student was surrounded by four plainclothes New York Police Department officers who accused her of credit card fraud after she bought a $2,500 handbag. Two months later, a 19-year-old student was followed by plainclothes NYPD officers and accused of fraud after buying a Ferragamo belt. Both shoppers have sued Barneys and the NYPD and the suits are pending.

Barneys CEO Mark Lee said in a statement that the company was “pleased” with the settlement with the AG’s office. “We are a truly progressive company that has absolutely no tolerance for discrimination of any kind, and believe this agreement will help build on that commitment and further strengthen our organization in the years and decades to come,” said Lee.

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