SACRAMENTO – On April 16, 2018, California Attorney General Xavier Becerra filed three misdemeanor charges against Melissa “Missy” Echeverria, 54, a real estate agent, for allegedly raising the monthly rent on property she owns in Novato by more than 10 percent following the devastating fires in San Francisco’s North Bay region, last fall. As the wildfires raged, Governor Jerry Brown declared a state of emergency (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.”
The investigation was conducted by attorneys and Division of Law Enforcement special agents from the California Department of Justice.
“California Department of Justice special agents work to protect Californians from harm, whether it s a physical or financial threat,” said California Statewide Law Enforcement Association (CSLEA) President Alan Barcelona. “You don’t always read about or see their law enforcement work, but they are actively working to keep us all safe – from gangs to price gougers.”
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.