SACRAMENTO, CA – California Attorney General Xavier Becerra today filed three misdemeanor charges against Melissa “Missy” Echeverria, a real estate agent, for allegedly raising the monthly rent on property she owns in Novato, California by more than 10 percent following the devastating fires in Northern Bay Area counties last year. Due to the blazes, Governor Jerry Brown declared a state of emergency on October 9, 2017. Price gouging during a state of emergency is illegal under Penal Code Section 396.
“In times of crisis, the overwhelming majority of Californians do what is right: we come together and help one another. Unfortunately, that’s not always the case,” said Attorney General Becerra. “There are some unscrupulous individuals who engage in price gouging, taking advantage of those who are already suffering. It’s wrong, it’s unconscionable, and it’s illegal. At the California Department of Justice, we are committed to ensuring that it’s not open season on innocent victims. I appreciate the strong partnership between my office and the Marin County District Attorney’s Office in this particular case.”
California law generally prohibits hiking the price of an item or service by more than 10 percent of what it cost before a state or local emergency was declared. This law applies to those who sell food, emergency supplies, medical supplies, building materials and gasoline. The law also applies to repair or reconstruction services, emergency cleanup services, transportation, freight and storage services, hotel accommodations and rental housing. Exceptions to this prohibition exist if, for example, the price of labor, goods, or materials has increased for the vendor.
Violators of the price gouging statute are subject to criminal prosecution that can result in one-year imprisonment in county jail and/or a fine of up to $10,000. Violators are also subject to civil enforcement actions including civil penalties of up to $5,000 per violation, injunctive relief and mandatory restitution. The Attorney General and local district attorneys can enforce the statute.
It is important to note that a criminal complaint contains charges that are only allegations against a person. Every defendant is presumed innocent until proven guilty.
Earlier this year, Attorney General Becerra and Director of the Governor’s Office of Emergency Services Mark Ghilarducci released a public service announcement, “Price Gouging is Not Only Wrong, It’s Illegal”. The PSA encourages members of the public to be vigilant against any illegal price gouging in the wake of natural disasters that have affected thousands of Californians.