August 24, 2005
Media Contact: Jenn Meale
Phone: (850) 245-0150
Attorney General Warns Floridians Against Price Gouging Over Tropical Storm Katrina
TALLAHASSEE – Attorney General Charlie Crist today warned unscrupulous businesses operators against taking advantage of Florida residents and visitors as they cope with emergency conditions associated with Tropical Storm Katrina. Crist mobilized his office and staffed a toll-free hotline at 1-866-9-NO-SCAM (1-866-966-7226) to handle consumer calls over possible price gouging. The Attorney General's action follows Governor Jeb Bush's official declaration of a state of emergency for all of Florida due to Katrina, extending the ongoing state of emergency that has been in effect from Hurricane Dennis.
"Florida has already seen an increasingly active storm season, bringing not only the threat of hurricanes, but also the threat of severe flooding and other extreme conditions," said Crist. "Consumers facing severe inclement weather shouldn’t have to worry about someone trying to take advantage of them. Any credible allegation of price gouging will be investigated and those in violation of the law will be stopped."
Those who suspect price gouging should call the Attorney General's hotline at 1-866-966-7226, and investigators will look into the complaint. Florida law prohibits extreme increases in the price of such commodities as food, water, hotels, ice, gasoline, lumber and equipment needed as a direct result of an officially declared emergency.
During last year's record-setting hurricane season, the Attorney General's Office received 8,911 complaints through its price gouging hotline. The office initiated 58 formal investigations and filed 13 price gouging lawsuits against hotels, generator businesses, tree removal companies and other businesses. To date the Attorney General's Office has recovered more than $700,000 in restitution for Florida consumers from settlements and other resolutions. Other investigations and settlement negotiations are ongoing, including two subpoenas served to date as a result of alleged price gouging from Hurricane Dennis.
Under Florida law, a commodity's price is unconscionable if the increase in the price represents a "gross disparity" from the average price of that commodity during the 30 days immediately prior to the declared emergency. This applies unless the increase is attributable to additional costs incurred by the seller or to national or international market trends. Violators of the price gouging statute are subject to civil penalties of $1,000 per violation, up to a total of $25,000 for multiple violations committed in a single 24-hour period. A new law enacted this year criminalizes price gouging and provides that during a declared state of emergency, any person who offers goods and services for sale to the public without possessing an occupational license commits a second-degree misdemeanor.
Crist also cautioned consumers to be wary of business scams that might arise in the wake of the flooding, including building repair and tree removal companies that come into storm-affected areas. The Attorney General said residents should deal whenever possible with established local companies when they contract for repairs or arrange financing to pay for any repairs that might not be covered by insurance.
Consumers should be wary of any unsolicited "contractor" who knocks on the door with an offer to fix a damaged roof or windows. Before signing any contracts, Floridians should check the contractor's license, payment terms and other provisions, Crist said.