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Texas Investigates Price Gouging, Scams in Wake of Ike

Attorney General warns residents to watch out for hucksters and con men

September 19, 2008
The Texas Attorney General's Office has received hundreds of complaints about price gouging in the wake of Hurricane Ike.

Those complaints allege businesses are gouging consumers on fuel, lodging, food, water, batteries, and power generators.

Under Texas law, vendors are prohibited from charging exorbitant prices for necessities such as groceries, clothing, medical supplies, lodging, repair work and fuel during and after declared disasters.

On September 7, Texas Governor Rick Perry issued a disaster declaration for numerous counties throughout Texas. That declaration is still in effect.

Many Texans are now staying in hotel and motels and state officials want them to know their rights in those facilities.

Starting on September 8--and lasting for a period of 14 days--Governor Perry suspended the collection of state and local hotel and motel taxes for victims of Hurricane Ike.

Consumers who are charged those taxes in areas affected by the hurricane should tell the hotel or motels that they are evacuees—and request the fees be removed from their bill.

Financial assistance is now available for hurricane evacuees who cannot afford long stays at hotels or motels. That help is offered by the U.S. Department of Homeland Security's Federal Emergency Management Agency (FEMA). Evacuees can apply for assistance online at www.fema.gov or by calling (800) 621-3362.

Texas officials remind consumers to keep all their receipts. That helps investigators document any gouging or unauthorized charges.

Other scams

Price gouging isn't the only fleecing of Texas residents to watch out for. Texas authorities are warning consumers to be wary of scams that often surface after a natural disaster.

In the wake of Hurricane Ike, authorities are worried about an onslaught of phony charity scams and unscrupulous clean-up and recovery schemes. Some con artists may claim to represents charities that will benefit storm victims, Attorney General Greg Abbott said.

"Texans who are contacted and asked to donate to a charity should verify the charity's purpose and request brochures or other literature that describes the organization's relief efforts," he said in a statement issued by his office.

Abbott also said homeowners should review their insurance policies to find out what property damages are covered. They should also be leery of door-to-door contractors who offer to make home or roof repairs.

"The work of these laborers is frequently careless and overpriced," Abbott said. "In some cases, they demand up front payment and leave with the homeowner's money without making the promised repairs."

Consumers should also be wary of buying any vehicles that have suffered water damage.

"Before agreeing to buy new vehicles from dealers in the area affected by Ike, consumers should look for water lines on the carpet or in the glove compartment," Abbott said.

Consumers also need to watch for scam artists that pose as governmental workers. Those con artists, Abbott said, may try to obtain consumers' bank account numbers or even cash.

"Before providing any personal information to someone claiming to be a government official, Texans should insist on seeing proper identification," he said.

Abbott also reminded consumers that Texas has issued a disaster declaration, which makes price gouging illegal. The action specifically prohibits businesses from charging consumers exorbitant prices for such necessities as water, food, batteries, and generators.

Consumers taken by any of these schemes should contact the Texas Attorney General's Consumer Complaint Hotline at (800) 252-8011. Consumers can also file complaints online at www.texasattorneygeneral.gov.

More Scam Alerts ...

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