OK Businesses Charging Disaster Victims $40 for Bottled Water

Bottled_water_in_supermarketThe Oklahoma Attorney General’s office has been inundated with reports of serious price gouging in the wake of one of the state’s worst reported tornadoes. One report revealed a local retailer selling cases of bottled water for an outstanding $40 per case.

Attorney General Scott Pruitt said that his office has been investigating reports of price gouging all over the state since before the first tornadoes even touched down. In addition to the $40 cases of bottled water, there have been numerous claims of hotels doubling or even tripling their rates in the wake of the disaster.

The Emergency Price Stabilization Act, passed in 1999 after a similar disaster (and similar price gouging) states that retailers are barred from increasing their prices on basic survival necessities like food, water and shelter more than 10% for 30 days after a region has been considered a disaster area.

AG Pruitt says his office will continually work to uncover acts of price gouging in disaster areas in OK and will actively prosecute violators of the EPSA. He further states the need to civilians to be diligent about reporting such cases to the local police department or calling the A.G. Fraud hotline directly at 405-521-2029.

There are, however, two sides to every story.

In a disaster scenario, local businesses are not immune to the same difficulties civilians face with procuring supplies. After hurricane Katrina for example, trucking and shipping lanes were disrupted for months after the disaster. This means that all the trucks and ships delivering to New Orleans had to be re-routed to a much longer route to get their goods into the city. These changes raised the rates for transportation companies, and therefore retailers, significantly.

There also may be other explanations for price-gouging in a disaster scenario. In hurricane Sandy, numerous vendors in NY were selling bags of ice for over $5 a bag and were accused of taking advantage of victims with price gouging. However, just like the rest of the affected area, these businesses were without power and reliable transportation. One business owner explained that after procuring the ice from retail stores outside the disaster, transporting it and using gas-powered generators and freezers to keep it frozen, he was actually losing money on every $5 bag of ice he sold, and was simply doing it as a service to the community during the disaster. There was no profit to be made becausew the cost of him even getting the ice to the disaster victims was 400% higher than it usually would be.

This raises the question of what is and what isn’t price gouging. It’s easy to look at a $40 case of water and a $5 bag of ice and claim it is price gouging; however, there may be more to the story. OK Investigators will continue to work around the clock to deter price gouging and making sure that local businesses are not banking on the misfortune of their customers.

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