As the Coronavirus has people hoarding everyday items like toilet paper and hand sanitizer, some businesses, and people, are taking advantage by price gouging. It’s not something that’s isolated to one part of the country; it’s going on everywhere and chances are you may have seen it in action. The good news: you can take action by reporting price gouging.
What is Price Gouging?
Price gouging happens when a retailer or wholesaler sells items or services at a cost considered unreasonable, like when something that usually costs $3 all of a sudden costs $20.
Many states are keeping an eye out for price gouging. The Wisconsin Department of Agriculture Trade and Consumer Protection (DATCP) says wholesalers and retailers cannot charge more than 15% of the price they charged in the past 60 days.
What Are Some Examples of Price Gouging Around the Country?
Spotted a bottle of hand sanitizer that usually sells for between $3-$5 suddenly selling for $10. This is a scenario where retailers who may have this item in stock while other places have run out are taking advantage of customers. If people are desperate to get their hands on a bottle of hand sanitizer, they may just give in and pay the $10.
In Connecticut, there have been reports of bottles of 7.5-ounce bottles of hand sanitizer selling for $25. Besides hand sanitizer, 30-packs of toilet paper have been marked up to $39.99 and three-packs of disinfectant wipes at almost $40.
Online vendors are also being accused of price gouging. In one instance, a pack of face masks was being sold for $50 with a $200 shipping fee. A study by the US PIRG Education Fund also found a package of 320 Lysol wipes that typically sold for $13.57 was selling for $220 on Amazon. The group found a good amount of price gouging among third party vendors, but also found some on Amazon’s own products.
CBS News reported this e-mail response from Amazon, “There is no place for price gouging on Amazon. We are disappointed that bad actors are attempting to artificially raise prices on basic need products during a global health crisis and, in line with our long-standing policy, have recently blocked or removed hundreds of thousands of offers. We continue to actively monitor our store and remove offers that violate our policies.”
What to Do About Price Gouging
Many states are encouraging people who suspect price gouging to report it to their Attorney General’s Office. Some states, like Maryland, which did not have price gouging laws in effect, have enacted legislation aimed at limiting increases in consumer goods and services.
In New Jersey, more than 80 warning letters were sent to businesses accused of price gouging. The Attorney General’s Office in New Jersey has received 619 complaints so far. Sellers are not supposed to raise their prices more than 10% during an emergency. In the Garden State, businesses face up to $10,000 in fines for their first price gouging offense.
The hope is that by states staying on top of price gougers and punishing them that it will deter other businesses to do the same.