7 Eleven

A joint Four Corners and Fairfax Media investigation into 7-Eleven has uncovered startling and systemic wage fraud across the country's biggest convenience store chain, including falsification of payroll records and other illegal practices.

The nation's biggest convenience store chain is ruthlessly rorting wages of its workers. This first part of a joint Fairfax Media/Four Corners series of articles blows the lid on a scandal that demands action.

A BusinessDay - Four Courners joint investigation has found allegations that 7-Eleven store owners defrauded and blackmailed staff.Arsineh Houspian

The consent order specifically listed the St. Petersburg outlet as one that 7-Eleven could not acquire without providing the FTC with prior notice. According to the FTC’s complaint, 7-Eleven acquired the St. Petersburg fuel outlet in December 2018, in violation of the consent order. On March 25, 2022—over three years after 7-Eleven acquired the St. Petersburg outlet—7-Eleven first informed the Commission it had acquired the St. Petersburg outlet. The FTC found that 7-Eleven’s internal controls for ensuring compliance with the consent order were wholly inadequate and that the company failed to implement any meaningful systems to ensure compliance with the Commission order.

The Federal Trade Commission today sued 7-Eleven, Inc. alleging the convenience store chain violated a 2018 FTC consent order by acquiring a fuel outlet in St. Petersburg, Fla. without providing the Commission prior notice.

The Federal Trade Commission sued 7-Eleven, Inc and its parent company, Seven & i Holdings Co., Ltd., alleging the convenience store chain violated a 2018 FTC consent order by acquiring a fuel outlet in St. Petersburg, Fla. without providing the Commission prior notice.

A recent Bloomberg story may offer some insight into why, in its bid to ramp up deportations of undocumented workers, ICE targeted 7-Eleven franchisees: Reporters Lauren Etter and Michael Smith found that 7-Eleven had “given the names of franchisees to the government,” and that ICE conducted raids on several franchisees who have engaged in legal disputes with the company or vocally criticized chief executive Joe DePinto. Company policy states that the corporation can take stores back from franchisees found to be violating immigration law, according to Etter and Smith.

The first 7-Eleven stores opened in Tel Aviv, but the outbreak of war severely impacted the city, with fewer patrons and more people mobilized for military service. It is alleged that 7-Eleven showed little empathy for these difficulties, reportedly taking steps to reduce and conceal its presence in Israel. The chain canceled its local representation and froze plans to open more stores until the end of the conflict, avoiding publicity, apparently to reduce its visibility and avert anti-Israel protests.

He befriended one of the staff and was told that it wasn't just his store who underpaid staff, but all 7-Eleven stores.

It can also be revealed that another store busted as part of last year's Fair Work raid is also believed to be still behaving badly.

Fair Work launched action against the 7-Eleven Blacktown franchisee Harmandeep Singh Sarkaria in July for underpaying two workers at his store and providing the regulator with false and misleading records of when staff worked.

ShinyHunters claimed it accessed over 600,000 records with personal information, according to two lawsuits in the US District Court for the Northern District of Texas. 7-Eleven told regulators that the compromised data was provided during the franchise application process.

According to court filings, from 2000 until the present, the defendants collectively and systematically employed more than 50 illegal immigrants at fourteen 7-Eleven franchise stores in Long Island and Virginia. Rather than transmitting the true identification information of the illegal immigrant employees to 7-Eleven headquarters for processing, the defendants allegedly used more than 20 stolen identities, submitting stolen names and Social Security numbers of United States citizens to conceal the presence of illegal immigrants on the 7-Eleven franchise store payrolls. 7-Eleven headquarters processed the payroll and sent the employees’ wages to the defendants for distribution. The defendants then allegedly stole significant portions of the illegal immigrants’ wages, rather than paying the workers in full. The defendants also required the illegal immigrant to live in residences owned by the defendants and to pay rent in cash to the defendants.

Days after the September 2014 Fair Work raid, one 7-Eleven operator, Kumar Sundarakumar, who runs the shop at 237 Exhibition Street in Melbourne, decided to pre-empt any findings by confessing to deliberately underpaying 12 of his staff.

In just the past three months, the retailer has delayed its IPO, announced ambitious store growth and remodeling plans, and initiated a company-wide reorganization that led to several leaders losing their roles. 7-Eleven has also launched several foodservice programs, including kids’ meals and catering as well as a happy hour for its iconic Slurpee beverage.

The restructuring is part of 7-Eleven’s transformation plan. The number of layoffs is unknown, although individuals in several departments, including people in leadership roles, appear to be impacted. Read the full article ➔

7-Eleven is laying off an undisclosed number of employees as the convenience retailer undergoes a company-wide reorganization as part of its transformation plan, a spokesperson confirmed to C-Store Dive on Thursday.

From June 2020 to August 2021, 7-Eleven conducted surveys that required customers to fill out information on tablets with built-in cameras. These tablets, which were installed in 700 stores, captured customers’ facial images at two points during the survey-taking process — when the individual first engaged with the tablet, and after they completed the survey.

During period in which they are trained, some franchisees force the workers to work more than 20 hours a week to get the job.

In March 2004, Choe began operating the 7-Eleven store in Long Island and agreed to abide by state and local labor laws. Between 2004 and November 2019, Choe hired individuals who did not have authorization to work in the United States and allowed those employees to use false social security numbers and other personal identifying information. As a result, Choe was able to pay his employees sub-standard wages and enrich himself.

Fair Work's raid last September revealed of the 20 stores audited, 60 per cent were underpaying staff. This was double the findings of its previous audit of 56 stores in Victoria.

The raids were swift and co-ordinated. Teams of inspectors from the workplace watchdog swooped on 7-Eleven stores across the country.

The second, published last month, found a similar pattern at convenience store chains 7-Eleven and Circle K. Consumer complaints, along with state and local inspections, revealed overcharges for snacks, beverages, toiletries, tobacco and medications. In addition, some stores charged more at the pump for gasoline than the prices displayed on their big road-facing signs.

The Guardian found that 7-Eleven and Circle K stores frequently charge customers more at the register or pump for snacks, gas and other items than the prices they promise on the shelf or on outdoor fuel signs.

A spokesperson for 7-Eleven, which operates some 8,000 locations nationwide, said, “We are heartbroken by this tragedy and our thoughts continue to be with Mr. Garcia and his loved ones. It is important to note that this unfortunate accident was caused by a reckless driver who pled guilty, and this store followed all local building codes and ordinances.”

BP, 7-Eleven, and Walmart are among a slew of gas stations, convenience stores, and big-box retailers that got sued this week for allegedly using artificial intelligence to spike gas prices in California. U.S gas prices have recently hit a record high, up as much as 50% since the war with Iran began. And California has some of the nation's highest fuel prices, with regular gasoline averaging $5.56 per gallon on Tuesday, compared with the national average of $3.92, according to AAA. The class action lawsuit on behalf of California drivers alleges the businesses, which include Walmart and Albertsons and together operate over 1,700 gas stations, are violating California's Cartwright Act antitrust law and Assembly Bill 325, which prohibits algorithmic price fixing. The suit was filed in federal court in the Golden State's capital on Monday, according to Bloomberg, which first reported the story. At the center of this case is Kalibrate's AI fuel-pricing tool, which the businesses employ to set fuel prices—but which is accused of using data at the pumps to "coordinate high prices ​and wring more money from the pockets of consumers," Reuters reported. How much money? According to the federal suit, Kalibrate's pricing increased gas prices by as much as 30 cents a gallon—to a high of $7 a gallon—for a total spike of $134 million a year, per Reuters. "While families struggle to afford the commute to work, defendants have conspired to ​put an end ​to competition, joining ⁠an AI-powered trust to ensure that no matter where a driver turns, the price for gasoline is artificially ​high," according to the complaint, Reuters reported. “We are reviewing the complaint and will respond appropriately to the Court," a Walmart spokesperson said in an email statement. Fast Company has reached out to Kalibrate, BP, Albertsons, and 7-Eleven for comment.

A former 7-Eleven Inc. employee secured a class-wide settlement in her lawsuit challenging the convenience chain’s practice of charging extra fees to tobacco-using workers on its health plan.

Litigation over 7-Eleven Inc.‘s practice of charging extra fees to tobacco-using workers on its health plan settled for more than $2.3 million, a Texas federal court filing shows.

7-Eleven has prevailed in its ongoing lawsuit against two former franchisees in California after the retailer cut ties with them over accusations of fraudulent c-store transactions, according to documents filed last week with the U.S. District Court for the Central District of California.

Investigators say 7-Eleven chains statewide use the gas as part of its fountain beverage system and have filed reports on employees completing training even though they did not fulfill the legal obligations of that training.

Yousaf Naseer of 7-11 stated, "I became a 7-Eleven franchisee in 1985 and have been a part of United Franchise Owners of Long Island and New York (UFOLI) for more than twenty-five years. I have served as President of UFOLI since 2017. As a 7-Eleven franchisee, I decided to participate in the IMAGE program to work closely with Homeland Security Investigations, so that I can ensure that I have established proper hiring procedures for my businesses. IMAGE provides me with the training, tools, and resources I need to hire an authorized workforce and to eliminate all clerical mistakes while properly completing the I-9 Forms. The E- Verify program makes it easy for me, as an employer, to ensure that all of my employees are authorized to work in the United States and that all of their documents are authentic. It gives me the ability to avoid non-compliance with the immigration laws.”

7-Eleven, Incorporated franchise stores sold, supplied, offered for sale an automotive windshield washer fluid product for use in California containing concentrations of volatile organic compounds (VOC) that exceeded the standards specified in title 17, California Code of Regulations section 94509(a). The VOC violation resulted in 1 ton of excess VOC emissions. To come into compliance,