Consumers warned of price gouging, fraud in storm aftermath

Businesses and scammers are being warned not to take advantage of consumers by price gouging or other fraud schemes during a state of emergency, with San Diego County District Attorney Summer Stephan saying Wednesday that doing so can result in prosecution and jail time.

As a result of the damage and devastation caused by Monday's storm, San Diego County 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 Gov. Gavin Newsroom declared an emergency in the county.

During a declared state of emergency, it is illegal for a business to increase prices for essential goods or services by more than 10%, unless it can show that its own costs have been increased, Stephan said.

"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 a fine of up to $10,000, according to Tracy DeFore of the County of San Diego Communications Office. Violations can also incur civil penalties of up to $2,500 per violation, injunctive relief and victim restitution.

DeFore said the gouging prohibition applies to several products and necessities including food and drink, emergency supplies such as water, flashlights, radios, batteries, candles, blankets, soaps, diapers and 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, DeFore said.

"Consumers should be extremely cautious if approached by aggressive agents, adjusters or contractors after a disaster," DeFore said. "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."

Other tips:

— 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," DeFore said. "Do not provide payment up front and be sure to ask where the debris is being taken. Scammers often ask for money up front and then disappear."

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.

Price gouging complaints can be filed with the San Diego County District Attorney's Office or by calling the DA's Consumer Protection Unit at 619-531-3507, with the California Attorney General's Office, the California Department of Insurance or by calling the Helpline 1-800-927-4357.

To check a contractor license or file a complaint with the Contractors State Licensing Board, call 1-800-321-2752.