Price gouging probe | Arkansas Blog

Tuesday, September 16, 2008

Price gouging probe

Posted By on Tue, Sep 16, 2008 at 11:48 AM



 

Attorney General Dustin McDaniel said today that his office had or would be issuing subpoenas to 10 fuel suppliers for an investigation of whether they unalwfully raised prices last week during the scare about interrupted gasoline supplies on account of Hurricane Ike.

The subpoenas will go to businesses that charged prices ranging from $4.29 to $4.64 a gallon. They follow thousands of reports of big prices increases to his office.

Subpoenas will go to Kum and Go, with outlets in Northeast and northern Arkansas; KC Gas Market, with three stations in Osceola; Arkansas Travel Centers, with stores in Choctaw, Marhsall, Conway, Greenbrier and Damasucs; Day and Nite Stores, with nine stores in England, Camden, Sheridan and El Dorado; Hard Hat Stores, with five stores in Blytheville and Osceola; 31/38 Grocery in Ward; Gary's Food Mart, five stores in Mississippi County; S&H Quick Stop in Imboden; Hess Oil Company in Alexander, and Pilot Travel Centers in West Memphis and Russellville.

On the jump, some info from the A.G.'s office on what the law says about price gouging. In short, a big increase does not necessarily constitute a law violation, however painful. If McDaniel finds evidence the law was broken, he said he'll seek restitution and penalties.

FROM THE ATTORNEY GENERAL'S WEBSITE

... the law prohibits businesses from charging more than 10% above the pre-disaster price of the goods or services. The scope of the law is very broad and is intended to cover anything that may be needed in the event of a state of emergency. Examples of items and services covered by the law include: food, water, flashlights, batteries, blankets, plywood, nails, hammers, medicine, bandages, lumber, and fuel."

"While the law sets a general 10% cap on prices during an emergency, businesses may lawfully charge a higher price if they can successfully establish that the higher price is directly attributable to additional costs imposed by the supplier or the result of additional costs for labor or materials used to provide the goods or service. In such a limited situation, the business may charge no more than 10% above the total of the cost to the business plus the markup which would customarily be applied by the business for that good or service in the usual course of business immediately prior to the onset of the state of emergency."

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