July 1, 2010
Texas Attorney General Greg Abbott is advising residents of South Texas affected by Hurricane Alex that the state disaster declaration activates state laws that prohibit price gouging.

The declaration triggers the provision of the Deceptive Trade Practices Act, which makes it unlawful to sell or offer to sell fuel, food, medicine, or another necessity at an exorbitant or excessive price.

"During declared disasters, state law prohibits vendors from dramatically increasing the price of necessities," Abbott said. "South Texans should take steps to protect themselves and report any alleged price-gouging to the Office of the Attorney General. After the storm subsides, residents should carefully screen offers for repairs or construction services and be sure to obtain accurate information before contracting for repair services."

The disaster declaration affects the following counties: Aransas, Bee, Brooks, Cameron, Duval, Hidalgo, Jim Hogg, Jim Wells, Kenedy, Kleberg, Live Oak, McMullen, Nueces, Refugio, San Patricio, Starr, Webb, Willacy, and Zapata.

Avoiding ripoffs

When Texans turn to repairmen to help in the clean-up and rebuilding process, they should consider these tips:

• Deal only with licensed or bonded contractors or builders;

• Contact an insurance adjuster to get an estimate of the damage and repair cost;

• Be wary of contractors who solicit services door-to-door, especially those that are unfamiliar or from out of town;

• Get the salesperson's license plate number;

• Don't rush into signing a contract, and never pay up-front for promised work;

• Secure the terms of any warranty work in writing; and

• Ask for references, or rely on recommendations from friends or relatives who have had experience with honest contractors.

Although Texas' price gouging law prohibits vendors from illegally raising prices to reap exorbitant profits during a disaster, it does allow retailers to pass along wholesale price increases to customers. Thus, in some cases, increased prices may not necessarily signal illegal price gouging.

Texans who believe they have been deceived by fraudulent business practices should call the Office of the Attorney General's toll-free complaint line at (800) 252-8011 or file a complaintonline.