When businesses raise their prices too much during and after an emergency, it may be considered price gouging, a crime in California.
Living in Los Angeles County means you might one day suffer damage from fires, floods, earthquakes, or other disasters. Occasionally, people use these times of emergency to try to make an extra profit. When businesses raise their prices too much during and after an emergency, it may be considered price gouging, a crime in California.
What is price gouging?
If the government (e.g. President, Governor, mayor, County Board of Supervisors) declares a state of emergency or a local emergency, businesses cannot increase prices of food, repairs, construction, housing, emergency and medical supplies, and gasoline more than 10 percent in the disaster area. Landlords cannot raise their month-to-month rent more than 10 percent in an emergency.
This protection from a 10-percent price increase or more on goods and services is good for 30 days from the day the emergency is declared.
This protection extends for 180 days on contractor-related services. (For tips on hiring a contractor, see our tip sheet.)
Protections for businesses
Businesses can only raise prices more than 10 percent in an emergency area if they can show that the increase is due to price increases from their suppliers.
If you are a business owner and believe your price increase is justified, keep complete records of your transactions as proof.
Price gouging can result in penalties to business owners including a $10,000 fine, one year in jail, or both.
Keep your receipts
If you make purchases or hire help after a declared emergency, keep detailed records. If you suspect price gouging, try to compare the prices you paid for ones prior to the declared emergency. You can check prices in areas not affected by the disaster.
Report suspected price gouging
If you believe you are a victim of price gouging, save your receipts and contact us at (800) 593-8222 or file an online complaint.
For more information about scams during and after an emergency, read our After the Disaster news article.
California Penal Code 396
L.A. County’s Price Gouging Ordinance
County of Los Angeles Department of Consumer and Business Affairs. Last change: Jan. 19, 2022