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California Attorney General Rob Bonta today issued a consumer alert following the Governor’s declaration of a state of emergency in Siskiyou County due to McKinney and other fires. The fires have destroyed homes, threatened critical infrastructure, and forced the evacuation of thousands of residents since they began burning. In today’s alert, Attorney General Bonta reminds all Californians that price gouging during a state of emergency is illegal under Penal Code Section 396.
“As wildfire season ramps up here in California, I want to be crystal clear: price gouging during a state of emergency is illegal,” said Attorney General Bonta. “California’s price gouging law prevents businesses from overcharging Californians for essential services and supplies during their moment of need. As Attorney General, I will use the full powers of my office to protect vulnerable Californians from those who would take advantage. I strongly encourage anyone who believes they have been the victim of price gouging to report it to my office at oag.ca.gov/report or to your local authorities.”
California law generally prohibits charging a price that exceeds, by more than 10%, the price of an item before a state or local declaration of emergency. For any item a seller only began selling after an emergency declaration, the law generally prohibits charging a price that exceeds the seller’s cost of the item by more than 50%. 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, certain transportation services, freight and storage services, hotel accommodations, and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the business.
Violators of the price gouging statute are subject to criminal prosecution that can result in a 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 $2,500 per violation, injunctive relief, and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.
For additional information on price gouging, please see oag.ca.gov/consumers/pricegougingduringdisasters.