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Inconvenient problem: One in four 7-Eleven stores caught selling tobacco to kids

The convenience store giant and nation’s largest retailer of tobacco products has a history of violating federal law resulting in warning letters, fines and a multi-state agreement.

PORTLAND, Ore. — The nation’s largest convenience store chain has a problem. Undercover inspectors caught 7-Eleven stores illegally selling tobacco products to minors 2,307 times since 2010, according to the Food and Drug Administration.

That means one in four 7-Eleven stores nationwide was busted during undercover stings selling tobacco to kids, including cigarettes, flavored cigars and e-cigarettes.

“This violative history is disturbing and cannot possibly come as a surprise to corporate leadership,” Dr. Scott Gottlieb, commissioner of the Food and Drug Administration, wrote in an April 5 letter to 7-Eleven, Inc. “These illegal sales must stop.”

Watch: 7-Eleven store fails to ID college student for cigarettes

The convenience store giant is in a uniquely powerful position to help protect children from the dangers of tobacco products, at a time when e-cigarette use among youth has reached epidemic levels.

“It is more critical now than ever to really crack down on these sales,” said John Schachter of the Campaign for Tobacco-Free Kids.

Although it’s best known for selling Slurpee drinks and the Big Gulp, 7-Eleven also is the nation’s largest retailer of tobacco products.  

7-Eleven has 7,925 locations nationwide, including 153 stores in Oregon. Many 7-Eleven stores are conveniently located in neighborhoods and near schools.

“They represent a very large part of the market share moving tobacco products into our community,” said Dr. Jae Douglas, Multnomah County Environmental Health Director. “Just on sheer volume- we depend heavily on these big retailers to understand that responsibility.”

When retailers are caught selling tobacco products to youth by undercover inspectors, the FDA issues a warning letter. The agency can also take enforcement actions, including civil money penalties or temporarily banning a specific retailer from selling tobacco.

Since the FDA retailer enforcement program began in 2010, 7-Eleven has racked up 888 civil money penalties nationwide for stores caught selling tobacco to minors more than once in a one-year period, according to an FDA database.

FDA: Compliance checks of tobacco product retailers

One of those fines was levied against the owner of a 7-Eleven location in Southwest Portland. Undercover inspectors caught clerks at this store selling tobacco to minors on four different occasions during a nine-month period in 2018. The FDA fined the store franchisee, Gulati Enterprises, $2,282 for the repeated offenses at 13285 Southwest Pacific Highway, according to federal records.

The owner of Gulati Enterprises was not available for comment.

“Violating the law preventing sales of tobacco products to minors, and paying associated fines and penalties, should not simply be viewed as a cost of doing business,” said Dr. Gottlieb.

In 2005, 7-Eleven’s corporate leadership promised to make changes to prevent kids from buying cigarettes as part of a court-approved agreement. The deal, signed by Attorneys General in Oregon, California and 38 other states, required 7-Eleven adopt strict new policies and improve training among its employees.

The agreement is still in effect today, according to the California Department of Justice. It applies to all 7-Eleven company-owned stores. Franchisees were asked to comply as well.

As part of the agreement, 7-Eleven promised to hire an independent agency to conduct random checks of stores annually.

The convenience chain also agreed to check identification for anyone buying tobacco products if they appear to be under 27. In Oregon, the minimum legal sales age for tobacco is 21.

To test this policy, KGW had a 21-year old college student buy a pack of cigarettes at two different 7-Eleven locations in Portland. The clerk at one location properly asked for identification, but the clerk at the second did not verify the customer’s age. That’s in violation of the 2005 court-approved agreement and an FDA requirement that retailers check ID for anyone under the age of 27.

In addition to the FDA inspections, retailers in Oregon are also checked by the Oregon Health Authority and Oregon State Police. Additionally, Multnomah County conducts its own undercover stings to make sure tobacco retailers follow the law.

Last year, state records show 7-Eleven stores in Oregon had a violation rate identical to all other retailers: 18% illegally sold tobacco to minors.

Oregon State Police use teenage decoy buyers to test compliance. KGW tagged along on one of these stings in April in the Portland metro area.

Investigators had a female high school student named McKenna pose as a customer. The 18-year-old walked into randomly selected convenience stores and asked to buy tobacco products. If the store clerk denied the sale, McKenna would present the employee with a card acknowledging they passed inspection. If the clerk completed the sale, an Oregon State Police trooper stepped in and explained they’d failed the inspection.  

That’s what happened when McKenna tried to buy a pack of Zig-Zag grape-flavored rolling papers at a 7-Eleven store at 2401 NE Cornell Road in Hillsboro. The product was clearly marked as “underage sales prohibited.” The clerk did check her identification but sold her the product even though she’s not 21. 

Watch: 7-Eleven store sells rolling papers to underage decoy

“They’re not supposed to do that,” McKenna said as she walked out of the store.

The store manager declined to comment.

If a store makes an illegal sale, Oregon State police will issue a citation to the store clerk.

Fines range from $50 to $1,000, depending on who is fined and previous violations. In 2018, clerks – not managers or store owners – received more than 90% of the citations issued, according to state health officials.

“Focusing on the clerk is not a long-term solution. We want to see the focus on the retailers,” explained Schachter of Campaign for Tobacco-Free Kids.

Oregon is one of only nine states that doesn’t require a license to sell tobacco products. Health officials say requiring retailers to buy a license to sell tobacco can help ensure compliance. In theory, stores will be more vigilant about verifying ages while selling cigarettes because illegal sales could jeopardize their license and tobacco revenue.

“The retailers are the ones who need to feel the brunt of enforcement and the threat of either having a license suspended or revoked,” said Schachter.

RELATED: Washington state raises smoking age to 21

In recent years, Multnomah, Benton, Lane and Klamath Counties have passed local tobacco retail license requirements.

In Oregon, 7-Eleven’s chief competitor, Plaid Pantry, has been more successful in preventing the sale of tobacco products to minors by rewarding employees with cash bonuses. Plaid Pantry hands out a $200 bonus for any employee who passes an undercover sting inspection along with a $100 bonus for the store manager.

“I’ve watched videos where people are literally jumping up and down with joy because they’ve just been stung and they know they’re going to get a $200 bonus,” explained Jonathan Polonsky, President and CEO of Plaid Pantry. He estimated the company paid $52,000 in bonuses last year for employees who passed tobacco inspections.

Since 2015, Plaid Pantry has had only five violations in 177 state tobacco compliance inspections, compared to 41 violations in 265 inspections for 7-Eleven stores in Oregon, according to Oregon Health Authority records.

Map: 7-Eleven Tobacco Compliance violations in Oregon and Washington

Additionally, the company conducts extensive employee training and does its own undercover sting inspections. That includes checking on every new clerk twice in their first 90 days on the job.

Plaid Pantry also uses technology at the cash register to avoid selling tobacco to youth. A loud, audible warning tells the clerk to check identification when a tobacco product is rung up at the register. A scanner is used to check a buyer’s ID to make sure they’re legal.

Plaid Pantry, with 108 stores in Oregon and Washington, requires all employees to check ID for anyone who appears younger than 30.

“I think the only way you can achieve our success is to kind of model what we do,” Polonsky explained.

Health officials believe combating the illegal sales of tobacco products has taken on greater urgency because e-cigarette use among teenagers has skyrocketed at a rate of epidemic proportions.

According the Centers for Disease Control and Prevention, the percentage of high school students reporting e-cigarettes use in the past 30 days rose by more than 75 percent between 2017 and 2018. Use among middle school students also increased nearly 50 percent.

Parents: Tests can show if your kid is vaping

This surge in e-cigarette use has been fueled by cartridge-based devices, including JUUL. A typical JUUL cartridge or pod contains about as much nicotine as a pack of 20 regular cigarettes, according to an advisory by the U.S. Surgeon General.

 “The vast majority of smokers started by age 18 and almost all by age 26, so we know that this is something people pick up in young adulthood and adolescence,” said Dr. Jennifer Vines of Multnomah County Health.

Health officials explain that retailers play a critical role in keeping tobacco out of the hands of kids.

“We have to have a way to make sure people who sell these products know the rules and enforce those rules,” said Dr. Vines.

7-Eleven corporate communications did not respond to numerous requests from KGW for comment on this story.

In the April 5 letter to 7-Eleven President and CEO Joseph DePinto, the FDA asked the nation’s largest convenience store chain to provide a written plan and to work with franchisees to prevent illegal sales of tobacco products to minors.

“This egregious behavior must not continue,” wrote FDA commissioner Dr. Gottlieb.

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