BEWARE OF PRICE GOUGING AND FRAUD IN STORM'S AFTERMATH

By Tracy DeFore, County of San Diego Communications Office

January 24, 2024 (San Diego) -- San Diego County District Attorney Summer Stephan is warning businesses and scammers not to take advantage of consumers by price gouging or other fraud schemes during a state of an emergency – doing so can result in prosecution and jail.

As a result of the damage and devastation caused by the severe storm on Jan.22, the County of San Diego has proclaimed a local emergency on behalf of the Board of Supervisors in anticipation that resources and assistance from the state and federal government may be needed. The City of San Diego also proclaimed an emergency, and Governor Gavin Newsom declared an emergency in the county. During a declared state of emergency, it is illegal for a business to increase its prices for essential goods or services by more than 10 percent, unless they can show their own costs have been increased.

“The recovery process for people suffering from disasters, including their homes and businesses getting flooded, can be very difficult. We want to send a clear message that we will not tolerate any unlawful activity by greedy businesses, contractors or scammers who would seek to financially exploit victims of a disaster,” Stephan said. “Price gouging and unlicensed contracting during a state of emergency is not only a crime, it also can further victimize someone who may have already suffered a heavy loss.”

Violations of the price gouging statute are subject to criminal prosecution that can result in one-year imprisonment in county jail and/or a fine of up to $10,000.  Violations are also subject to civil enforcement actions including civil penalties of up to $2,500 per violation, injunctive relief and victim restitution.

The price gouging prohibition applies to several products and necessities including: food and drink (including food and drink for animals); emergency supplies such as water, flashlights, radios, batteries, candles, blankets, soaps, diapers, toiletries; and building materials, medical supplies such as prescription and nonprescription medications, bandages, gauze, isopropyl alcohol and antibacterial products.

It is also a misdemeanor for a hotel or motel to increase regular rates by more than 10% during a declared emergency and for the 30 days following the state of emergency.

Consumers should be extremely cautious if approached by aggressive agents, adjusters or contractors after a disaster. Most businesses are honest and have good intentions, but there are always bad actors waiting to take advantage of disaster victims.

Working as an unlicensed contractor during a state of emergency is a felony.  Keep these tips in mind when selecting a contractor:

• Ask for proof of licensing such as a pocket license and a second photo ID.
• Always verify that the license number matches the contractor you are dealing with.
• Beware of scare tactics, odd calls or unsolicited contacts.
• Make sure the contractor carries workers’ compensation and liability insurance.

In the aftermath of natural disasters, debris-clearing scams often surface. Do not provide payment upfront and be sure to ask where the debris is being taken. Scammers often ask for money up front and then disappear. Sometimes they dump debris on a neighbor’s property or park, which may cause you to be responsible for the costs and penalties.

The public is also warned to be cautious when dealing with persons soliciting for purported “victim relief” charities. Many legitimate organizations seek contributions during or after an emergency, but scammers often use phony charitable pleas in times like these.  Potential contributors should insist on seeing proper credentials before offering to help.

Here’s where you can find resources.

• File a price gouging complaint with:
  • San Diego District Attorney or call the District Attorney’s Consumer Protection Unit at (619) 531-3507
  • California Attorney General’s Office
  • California Department of Insurance or call Helpline 1-800-927-HELP (4357)
• Check a contractor license
• File a complaint with the Contractors State Licensing Board or call 1-800-321-2752