The office of Michigan Attorney General recently announced one of its first settlements.
Consumers across the United States have filed an unprecedented number of price-gouging complaints amidst the ongoing coronavirus outbreak.
In Pennsylvania, nearly 4,500 complaints have been filed with the state Attorney General’s Office. In Texas, one county alone has racked up hundreds of allegations in the past several weeks. And, on Wednesday, Michigan Attorney General Dana Nessel was forced to levy charges against online retailers charging exorbitant prices for high-demand hygiene products and cleaning supplies.
According to The Philadelphia Inquirer, one Pennsylvania store was caught charging upwards of $50 for a single pack of face masks. Another Philadelphia shop wanted $16 for a 24-pack of water bottles.
While many price-gouging reports have yet to be investigated—much less prosecuted—the U.S. Public Interest Research Group (PIRG) recently published research backing consumer complaints. Amazon retailers, are, on average, charging 50% more than usual for hand sanitizer bottles and face masks. One individual seller on CraigsList even posted a 2-liter bottle of hand sanitizer for $250—ten times the product’s regular, non-pandemic price.
Emma Horst-Martz, who works with Pennsylvania’s PIRG branch, said it’s unethical for merchants to take advantage of an ongoing crisis.
“It’s wrong for companies to engage in price-gouging at a time when people have enough to worry about,” Horst-Martz said. “We believe they have the ability to stop it and protect consumers at such a vulnerable moment.”
Pennsylvania—like many other states—already has legislation controlling price inflation amidst emergencies.
Pennsylvania, says The Philadelphia Inquirer, limits price increases to no “more than 20% above the average price of a good sold in the week before” an official declaration of emergency. In neighboring New Jersey, the cap’s lower, at 10%, with the legislation only excepting price increases caused by higher production costs.
Farther afield, in Texas, Attorney General Ken Paxton said there’ve been more than 300 price-gouging complaints in San Antonio’s Bexar County alone.
“Any person or business selling goods must be aware that they are prohibited by law from engaging in price gouging if they unreasonably raise the cost of necessary supplies at any point during a declared disaster,” Paxton said. “My office will work aggressively to prevent disaster scams and stands ready to prosecute any price-gouger who takes advantage of those taking precautions and looking for safety and supplies.”
In Texas, complaints have related not only to sanitary supplies but food staples like meat, eggs, and milk. One Bexar County consumer, for instance, reported meat mark-ups exceeding 100% at a San Antonio supermarket; others said Clorox packs were approaching $70. And—in one particularly unusual example—a gun store was refusing to sell ammunition to anyone unwilling to buy a firearm along with it.
While most price-gouging investigations have yet to punish violators, Michigan’s attorney general recently announced several settlements. On Wednesday, state Attorney General Dana Nessel said her office received an Assurance of Voluntary Compliance from a Hillsdale, MI, man who’d accrued $6,000 in profit from marked-up face masks.
As part of the AVC agreement, the man paid the A.G.’s office $6,000 in investigation recompense, plus an additional $100 to the victim who’d tipped off Nessel.