LOS ANGELES – California Attorney General Kamala D. Harris on Thursday issued a consumer alert on reports of price gouging by businesses, namely hotels, during the devastating wildfires that have swept our state. The Attorney General also issued a warning that the California Department of Justice is prepared to investigate and prosecute those that attempt to wrongfully profit from the destructive fires that are driving Californians out of their homes.
“As first responders fight to save communities from raging wildfires and thousands of Californians face devastation and hardship, it is exploitative and also unlawful for businesses to engage in price gouging,” said Attorney General Harris.
California’s anti-price gouging statute, Penal Code Section 396, becomes effective immediately after the Governor or a local official declares a state of emergency. Governor Jerry Brown declared a state of emergency in Calaveras and Amador counties on September 11, 2015, and in Lake and Napa counties on September 13, 2015.
California law generally prohibits charging a price that exceeds, by more than 10%, the price of an item before the declaration of emergency. This law applies to those who sell food, emergency supplies, medical supplies, building materials, and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials have increased for the business.
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. Violators are also subject to civil enforcement actions including civil penalties of up to $5,000 per violation, injunctive relief and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.
Anyone who has been the victim of price gouging, or who has information regarding potential price gouging, is encouraged to immediately file a complaint with the Attorney General’s Office by going to the Attorney General’s website or by calling (800) 952-5225.