Combat Emergency Profiteering

1. Disaster Profiteering Crimes

After Every Disaster:

• Hotels: Jack up their rates 5-10x (fleeing evacuees are desperate)
• Gas Stations: Price gouging (fuel prices double overnight)
• Bottled Water: $10/bottle (normally $1)
• Generators: $5,000 (normally $500)
• Contractors: Charge 3-5x their normal rates for repairs
• Towing Companies: Charge extortionate fees for flooded cars

Examples:

Hurricane Katrina (2005):

• Hotels in Houston: Raised rates from $70/night → $400/night (refugees had no choice)
• Bottled Water: Gas stations charged $10/case (normally $3)
• Towing: $500 to tow car 5 miles (normally $75)

Hurricane Ian (2022):

• Hotels in Tampa: $800/night (normally $150)
• Generators: $6,000 for $600 generator
• Contractors: $50,000 to tarp roof (normally $5,000)

Maui Fires (2023):

• Hotels on Other Islands: Raised rates 300% (displaced residents)
• Rental Cars: $300/day (normally $50)

2. Federal Emergency Anti-Gouging Act

Automatic Trigger:

• When the President Declares a Disaster: Price controls automatically activate
• Duration: 90 days after disaster declaration (extendable)

Price Freeze:

A. Essential Goods & Services:

• Cannot increase prices >10%: Above pre-disaster prices
• What's Covered:
  • Food, water, medicine, and baby formula
  • Fuel (gasoline, diesel, and propane)
  • Hotels, motels, and short-term rentals
  • Building materials, generators, and batteries
  • Transportation (rental cars, rideshares, and flights)
  • Contractors (construction, repairs, and tree removal)
  • Storage units (for belongings)

B. Pre-Disaster Baseline:

• 45-day Average: Before disaster
• Example: Gas was $3.50/gallon average (45 days before hurricane) = max price during an emergency is $3.85/gallon

C. Exceptions:

• Increased Costs: If supplier's costs have actually increased (must provide documentation)
  • Example: Trucking water into disaster zone costs more = can charge slightly more (but must show receipts)

3. Enforcement

Monitoring:

• FTC, State AGs: Monitor prices during disasters
• Hotline: Victims report gouging (photos and receipts)
• Undercover: Agents pose as victims and catch gougers

Penalties:

Civil:

• First Violation: $10,000 per transaction
  • Hotel charged $800 for 1 night = $10,000 fine
  • If sold 100 rooms = $1 million fine
• Second Violation: $100,000 per transaction + business closure (30 days)
• Third Violation: Permanent business license revocation

Criminal:

• Systematic Price Gouging: Felony
  • Business owner is prosecuted: 5 years in federal prison
  • Asset forfeiture: All profits from gouging seized

Restitution:

• All Victims Are Refunded: Triple damages
  • Paid $800 for hotel? Get $2,400 back ($800 refund + $1,600 penalty)

Corporate Liability:

• National Chains: (Marriott, Hilton, ExxonMobil, and Home Depot)
  • Corporate HQ is liable for franchisee/local branch gouging
  • Cannot hide behind the "independent operator" excuse
  • If local Marriott gouges: Marriott corporate pays the fine + restitution

4. Example Prosecutions

Marriott Hotels (Hurricane Ian):

• CEO Anthony Capuano:
  • Charges: 10,000 counts of price gouging (10,000 rooms at gouged rates)
  • Fines: $100 million ($10k per violation)
  • Criminal: 5 years in federal prison (systematic gouging = RICO)
  • Restitution: $30 million to victims (triple damages)
  • Asset forfeiture: $20 million personal wealth

Home Depot (Hurricane Katrina generators):

• Store Manager + Regional VP:
  • Charges: Conspiracy to gouge
  • Prison: 3 years each
  • Home Depot corporate: $500 million fine

Local Contractors (Maui):

• 50 Contractors Are Prosecuted: For charging 5x normal rates
• Prison: 1-5 years each
• Restitution: $100 million to victims

5. Perp Walks & Public Shaming

• Arrests During Disaster: FBI arrests gougers on-site
  • Gas station owner arrested at pump
  • Hotel manager arrested at check-in desk
• Media Coverage: Televised (deterrent to others)
• Message: Profiting from suffering = serious crime