Illegal price gouging in wake of Northern California wildfires

Wednesday, October 18, 2017

Amid historic wildfires, California Attorney General Xavier Becerra today called on California businesses about the state’s anti-price gouging statute. 

“As wildfires rage across California, it's vital to broadcast to all that our state’s price gouging law protects people impacted by an emergency from illegal price gouging on housing, gas, food, and other essential supplies,” said Attorney General Becerra. “This is not a matter that I take lightly—the blazes have claimed numerous lives and have displaced thousands throughout our communities. As the state’s top law enforcement officer, I am prepared to prosecute those unscrupulous individuals who try to turn a profit at the expense of our neighbors and friends. I encourage anyone who is aware of price gouging to immediately file a complaint through my office’s website, www.oag.ca.gov, or call 800-952-5225.” 

What is price gouging?

Price gouging refers to sellers trying to take unfair advantage of consumers during an emergency or disaster by greatly increasing prices for essential consumer goods and services.

Is price gouging illegal in California?

Yes, in certain circumstances. California’s anti-price gouging statute, Penal Code Section 396, prohibits raising the price of many consumer goods and services by more than 10% after an emergency has been declared. Local laws may also contain their own prohibitions on price gouging.

When does California’s anti-price gouging statute apply?

The statute applies immediately after the President of the United States, the Governor of California, or city or county executive officer declares a state of emergency resulting from any natural or manmade disaster, such as an earthquake, flood, fire, riot, or storm.

Who is subject to the statute?

Individuals, businesses and other entities must comply with the statute.