Price gouging is illegal

Q. I have heard that price gouging is illegal. Exactly how is price gouging defined and what are my remedies if I have been overcharged?

A. Price gouging is illegal, and may be prosecuted by the Texas Attorney General or any individual who has been a victim. The Texas Deceptive Trade Practices Act states it is a false, misleading or deceptive practice to take advantage of a disaster declared by the governor under Chapter 418, Government Code, by selling or leasing fuel, food, medicine or another necessity at an exorbitant or excessive price; or demanding an exorbitant or excessive price in connection with the sale or lease of fuel, food, medicine or another necessity.

Because the governor has declared Harvey a disaster, any business or individual selling or demanding an exorbitant or excessive price for a necessity violates this law.  This doesn’t mean a price may not rise due to increased costs, but it does mean a seller may not excessively raise a price simply because of a shortage or increased demand. For example, a business selling food that cost $10 before Harvey may raise the price to $12 if its costs go up by $2. It would be illegal, however, to raise the price to $20, simply because of increased demand and reduced supply.

If you feel you someone has charged or demanded an excessive or exorbitant price, you may file a complaint with the attorney general at http://txoag.force.com/CPDOnlineForm, or consider an individual claim under the Texas Deceptive Trade Practices Act in justice court. If you are successful in justice court you may receive up to three times your damages plus costs and attorney’s fees. Of course, the best first step is to talk with the seller and request a refund of any over-payment.

Remember, if you have questions about your legal rights dealing with issues that have arisen as a result of Hurricane Harvey, the Center for Consumer Law at the University of Houston Law Center can assist you. The Center has established a legal line at (713) 743-2168 for questions related to Harvey. Lawyers and law students at the Law Center answer the phones; however, due to heavy volume, you may not get a person when you call. If that happens, leave a message and you will receive a prompt call back.

 

Q. Is it legal for me to act as an “agent” for a company from outside the U.S.? The company will have their customers mail checks to me in my name, I cash the checks, keep a percentage of the original, and wire the remainder to company? This sounds like a great opportunity.

A.  It does sound like a great opportunity, and as my father used to say, “If it sounds too good to be true, it probably isn’t.” As far as I know, there is nothing illegal about representing a company from outside of the U.S. for the purpose of collecting payments. In this case, however, my opinion is that this offer is a scam. Without going into the details, what will happen is the checks you receive and “cash” eventually will bounce after you have forwarded your money to the company. You will then have to return all the money you received from the bank. The bottom line is you will be out a lot of money.  My advice is to ignore all of these get rich quick, work-at-home, schemes.

 

Q. Can you be turned in to a collection agency for a bill if you are at least paying something on it, say $5?

A. If you are not paying the full amount due on a debt the debt is considered in default and can be sent to collection. Sometimes speaking with the creditor and explaining why you are not paying the full amount and when you will be able to pay can delay collection efforts.

 

Q. Someone who owes me money just died. Am I out of luck? Do his children have to pay?

A. When someone dies, his or her children are not liable unless the child had agreed to pay the debt. You may not, however, be out of luck. After a person dies, his or her estate is responsible for the debts. You should file a claim with the executor or administrator of the estate. If there are any assets in the estate, they can be used to pay the money you are owed.

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