Price Gouging Forbidden During States of Emergency

New Jersey merchants were warned today that price gouging is prohibited during the states of emergency that have been declared in a handful of counties, and any others that may be declared. The warning was issued by Attorney General Jeffrey S. Chiesa and the New Jersey Division of Consumer Affairs.

Counties in south Jersey were placed in emergency status after violent storms ripped through the region, creating dangerous situations and cutting power to tens of thousands of residents. In Monmouth County, a handful of towns remain under a boil water advisory due to a major water main break last week.

"During life-threatening emergencies, New Jerseyans should look out for each other - not seek to take advantage of each other," Chiesa said.

New Jersey law makes it illegal for merchants to set excessive price increases during a declared state of emergency or for 30 days after its termination. The statute considers price increases excessive if they are more than 10 percent higher than the previous cost.

Chiesa continued, "We're sending a clear warning to any merchants who would think they want to engage in that practice."

First-offense violations are punishable by a fine of $10,000, and $20,000 for second and subsequent offenses.

In addition, Chiesa said scams can make their way into communities experiencing a disaster. For example, someone could pretend to collect money for a charity, but keep the collections for their own use. Also, people could falsely claim they are in the home repair business, collecting payment up-front and never returning to perform the scheduled work.

Consumers who believe they have been cheated or scammed by a business, or suspect any other form of abuse, can file a complaint with Consumer Affairs through its website or by calling 1-800-242-5846.