Oregon Governor and Attorney General Warn Oregon Storm Victims Of Potential Scams

Explain New Price Gouging Law

December 5, 2007 -- In the wake of the recent storms hitting the Pacific Northwest, Oregon Governor Ted Kulongoski and Attorney General Hardy Myers today warned storm victims to be alert for potential scams targeting them and reminded Oregonians about the state's new price gouging law.

"Natural disasters like the recent storm are usually followed by scam artists who will attempt to take advantage of victims' special needs for goods and services to recover from the storm," Kulongoski said.

"It is important that storm victims recognize these unscrupulous attempts to take their money and report them to authorities immediately," Myers added.

As storm victims begin assessing individual damage, many will want the services of construction and landscape contractors. Victims should avoid unlicensed contractors promising immediate, cheap home repair or tree removal. Phony clean-up crews and tree-cutting services also may begin soliciting services with an advance deposit on future work that is never performed.

Individuals and businesses should deal only with licensed and bonded contractors and should check complaint histories and ask for references before ever giving them money. Some "casual, minor or inconsequential landscape work" does not require a license with the State of Oregon. Consumers are encouraged to call the Construction Contractors Board at (503) 378-4621 or visit www.oregon.gov/ccb to check for licensing requirements of the specific work, to determine whether a particular contractor is licensed and bonded, and to obtain the contractor's complaint history.

Consumers should also check with the Landscape Contractors Board to verify a landscape contractor's license and bond and to determine complaint history by calling (503) 378-5909 or checking online at www.lcb.info@state.or.us.

The Governor and Attorney General also warn of door-to-door solicitors seeking to sell items like emergency kits and water filters. Such sellers have been known to appear in official-looking uniforms as representatives of county maintenance crews, staff to county officials, and law enforcement. Consumers should never buy from strangers selling at the door before thoroughly checking their identification and verifying that the company is registered to conduct business in Oregon. Consumers can verify a business registration by checking with the Secretary of State's Corporations Division at www.filinginoregon.com or by calling (503) 986-2200. Victims should not admit solicitors to their home and should instead ask that the sales offer be left in writing.

Individuals purporting to be government representatives wanting to assist victims to qualify for disaster relief payments should be asked for and willing to provide photo identification verifying their government employment status. In other states, phony "public officials" reportedly took "processing fees" and were never seen again.

The Governor and Attorney General also reminded Oregonians of the passage of Senate Bill 118 by the 2007 Oregon Legislative Assembly which outlaws price gouging in selling basic products and services during certain times of emergency. The Governor must declare that an abnormal disruption of the market exists to trigger the new law. To date, Governor Kulongoski has not issued such a declaration but today stated his intention to do so if necessary to respond to or prevent price gouging.

"I urge all sellers of essential consumer goods and services to avoid trying to take economic advantage of the conditions created by the storm," Kulongoski said. "I will act immediately under Senate Bill 118, however, if such action is needed to protect the public."

The law prohibits certain merchants and wholesalers from offering to sell or from selling, essential consumer goods or services for an amount that represents an unconscionably excessive price, typically an increase of 15 percent or more, during a declaration by the Governor of an abnormal disruption of the market in the affected geographical area described by the declaration. Price gouging as defined by the new law is a violation of the Oregon Unlawful Trade Practices Act, enforced by the Attorney General.

Essential consumer goods and services are goods and services that are or may be bought or acquired primarily for personal, family or household purposes such as residential construction materials or labor, shelter for payment such as a hotel room, food, water or petroleum products, and that are necessary for the health, safety or welfare of consumers.

The law exempts various price increases, including:

1. Increases attributable to additional costs imposed by suppliers (e.g., exterior market costs, etc.);
2. Increases attributable to additional costs necessarily incurred in procuring the essential consumer goods or services immediately prior to or during the declaration (e.g., flying-in supplies, etc.);
3. Increases attributable to increased internal costs or expenses related to the declaration (e.g., overtime, additional staff, security, distribution, etc.); and
4. Increases attributable to increased costs unrelated to the declaration (e.g., scheduled price or cost increases, etc.).

Members of the public who experience or observe a sale they believe would constitute price gouging under Senate Bill 118 or witness suspect business activity should call the Attorney General's hotline at (503) 378-4320 (Salem area only), (503) 229-5576 (Portland area only), or toll-free at 1-877-877-9392. Complaints can be filed online at www.doj.state.or.us. Hotline hours are 8:30 a.m. to 4:30 p.m.

Source: Oregon Governor