Gephardt: Most Price Gouging Complaints Aren’t Against The Law, Investigators Find
SALT LAKE CITY, Utah – Utah has received hundreds of complaints of price gouging amid the pandemic, but officials have only taken action on four of those cases. So, what constitutes “price gouging” under the state’s guidelines?
Someone in Utah wanted a Nintendo Switch. They found one being advertised online, but for way more than the manufacturer’s suggested retail price.
They marched down to the Utah Division of Consumer Protection and filed a complaint: That’s price gouging, which is illegal, right?
Actually, no, said DCP director Daniel O’Bannon.
“The law covers items that are necessary for response to an emergency,” O’bannon said, which would not include a videogame console.
Necessary items, in the case of this current crisis, include things like hand sanitizer, wipes, medicine, food and yes, toilet paper.
Two months ago, KSL TV reported that the state was actively cracking down on price gouging.
Checking in now, O’Bannon said they have received about 900 complaints of the illegal practice. Of those, the state has “taken action” on four.
If that number seems low to you, it’s because price gouging has a really narrow definition. Not only must the state find an item to be “necessary,” but they also have to take into account costs going up. For example, if the cost of raw materials has gone up, the cost of shipping has gone up, or even if a company has had to implement new safety measures to deal with COVID-19, it’s perfectly acceptable that those costs are passed on to customers.
“We’ve seen the gamut in investigating these price gouging complaints,” O’Bannon said. “And the reality is a lot of these complaints, people might think the prices are higher, but it’s not in a way that violates the law.”
By law, state officials aren’t allowed to reveal individual complaints lodged against companies or individuals for price gouging until action is taken, but KSL TV got the gist.
Most of the complaints aren’t about retailers jacking up the prices – rather people who are reselling high-demand items online. Both are illegal and the DCP has jurisdiction to cite both registered businesses and individuals.
Price gouging during a crisis can really be bad for the person who chose to do it. They can get fined $1,000 per instance up to $10,000 per day.
State officials said to keep those complaints coming if you see price gouging. Yes, they have only cited four people at this point, but that number will almost certainly go up as investigations conclude. The state has also been hitting folks with warning letters on some of the borderline complaints.
You can file a complaint at https://dcp.utah.gov/complaints.html.
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