An Antidote for the Poison of Gouging : The Law Is on the Side of Citizens Against Those Who Would Exploit Disasters

A San Fernando Valley activist group has been visiting merchants suspected of price gouging after the Northridge quake. Leaders of VOICE, or Valley Organized in Community Efforts, ask the merchants to listen to the complaints of customers who feel they have been charged inordinately high prices. VOICE then demands that the shop owners sign a pledge agreeing to stop gouging.

Another way to proceed would be to involve local authorities and laws already on the books.

Chief Willie Williams of the Los Angeles Police Department has already urged citizens to notify police immediately when they suspect they have been charged absurdly high prices for normally inexpensive items. That is one option. Another would make use of the fact that it is against the law in Los Angeles to increase the price of consumer goods, repair services and the like by more than 10% above the prices that immediately preceded a declared state of emergency.

Such gouging is punishable by up to six months in jail and a $1,000 fine. You can report these matters to a quake-related task force for investigation at 1-800-897-6677.

Quake victims whose homes have sustained damage are vulnerable to another kind of parasite. We refer to those who present themselves as honest, experienced and licensed contractors, but may be none of the above.

State contracting officials suggest the following rules of thumb: Always get three or four price estimates on quake-related repairs that must be made before you pay a dime to anyone. Also, you should demand to know the state license number of the contractors. If they refuse to give you one, tell them to take a hike. Finally, once you have their license numbers, call the state contractor hot line at 1-800-321-CSLB and they will tell you whether the contractor is indeed licensed with the state.

Suspected contractor fraud can also be reported to the Consumer Affairs Earthquake Fraud Hotline at 1-800-897-6677.

Several arrests have already been made in the aftermath of the quake for gouging and the like, including the case of an unlicensed contractor who was going to charge $1,000 for a roof repair that ultimately cost $50 to fix. Unlicensed contractors who attempt to do reconstruction work during a state of emergency are subject to up to three years in prison or a fine of as much as $10,000.

Making use of such laws will keep the few price-gouging merchants out there in line and the fake contractors out of your wallet.