Florida AG Notes $21,000 in Price Gouging Restitution with 2 Companies

August 30, 2005

Florida Attorney General Charlie Crist has announced his office has reached settlements with two companies accused of price gouging during last year’s record-setting hurricane season. Both cases involve established businesses that sold generators at prices far above their usual retail prices. The amount of available restitution is more than $21,400.

“Price gouging is the result of rampant greed and a willingness to take advantage of others during their time of need,” Crist said. “These settlements will provide well-deserved relief to many consumers, some who are still in the recovery process from last year’s storms. As we continue to deal with hurricane-related issues, our thoughts and prayers are with our neighbors in Alabama, Mississippi and Louisiana as they face the devastation wrought by Hurricane Katrina.”

The first investigation revealed that during Hurricane Frances Louisiana-based Ramco Power Systems LLC, purchased and then sold 57 electrical generators to Gulf Coast Tractor and Equipment in Land O’ Lakes, charging an average of 47 percent above the average retail price.

Gulf Coast subsequently sold the generators to customers, basing its prices on what it had paid Ramco. After confirming that prices had been inflated by Ramco, Gulf Coast provided customers more than $10,300 in refunds for the amounts overcharged.

Under the agreement with the Attorney General’s Office, Ramco must refund to Gulf Coast the money lost purchasing generators at the gouged prices. Ramco must also reimburse the Attorney General’s Office for fees and costs.

The second settlement resolves an investigation involving a Palm Beach County retail appliance store. During Hurricanes Frances and Jeanne, Chuck’s Appliance and TV purchased approximately 86 generators from two local Costco stores and then allegedly sold the generators to consumers at prices 32 percent to 55 percent higher than their original retail price.

Under the settlement, Chuck’s will pay more than $11,100 in restitution, as well as fees and costs.

Consumers who believe they are victims of the price gouging have 30 days to submit a claim by calling the Attorney General’s Office in West Palm Beach at 561-837-5000. Any remaining restitution funds will be paid to the Florida Hurricane Relief Fund. The settlement also provides that Chuck’s Appliance and TV will not sell generators in the future.

Last hurricane season, the Attorney General’s price gouging hotline received 8,911 complaints. This season’s Hurricane Dennis brought more than 2,000 complaints, and as of noon today only 47 complaints had been received regarding Hurricane Katrina.

From the 2004 season, the office has initiated 58 formal investigations and filed 13 price gouging lawsuits against hotels, generator businesses, tree removal companies and other businesses.

Including today’s settlements, the Attorney General’s Office has recovered approximately $725,000 in restitution for Florida consumers. Other investigations and settlement negotiations are ongoing, including two subpoenas served to date as a result of alleged price gouging from last month’s Hurricane Dennis.

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