NEW YORK - Federated Department Stores Inc.'s Macy's chain will pay New York state $600,000 to settle complaints of racial profiling of black and Hispanic shoppers by the department store's security guards.
The money will cover the state's cost of investigating the allegations, according to an agreement with Attorney General Eliot Spitzer's office that was released yesterday.
Customers had complained that guards at Macy's East division stores accused them of shoplifting based on their race or ethnicity.
"This is simply a question of fair dealing for all individuals," Spitzer said at a news conference. Minorities should be able to walk into a store and "not feel like they're going to be treated like second-class citizens merely because of the color of their skin," he said.
Spitzer said Macy's had cooperated with the investigation.
The agreement ends an investigation that began in 2003 into complaints that Macy's East, Cincinnati-based Federated's largest unit by sales, subjected nonwhite shoppers to false accusations, wrongful detentions and illegal searches. Spitzer's office also found that detained customers were unlawfully handcuffed.
Some people who were detained might not have been innocent, said Spitzer, but "the issue is not everyone was innocent, but that they [the store guards] zeroed in on an individual because of race."
The settlement does not preclude the complainants from filing civil lawsuits seeking damages.
Macy's admitted no wrongdoing but agreed to hire a security monitor to ensure compliance with policies banning profiling and to improve training.
Employees found to have engaged in profiling or any form of discrimination will be disciplined or fired, Macy's said in a statement.
A 2003 lawsuit on behalf of shoppers who said they had been unfairly targeted was dismissed in July.
Federated has more than 450 stores in the United States, Guam and Puerto Rico, including more than 90 Macy's East stores.
Shares of Federated rose $1 to close at $58.37 yesterday on the New York Stock Exchange.
The Associated Press and Bloomberg News contributed to this article.