When a natural emergency takes place, consumers should be on the lookout for scams including price-gouging, fly-by-night door-to-door contractors, and bogus charities.
Price Gouging
When a emergency takes place, some businesses may raise their prices excessively on essential goods and services like drinking water, housing, food, and fuel. Charging excessive prices for necessities when a emergency has been declared by the governor can constitute price gouging and should be reported to our Office.
Under the Texas Deceptive Trade Practices Act, price gouging is illegal, and the Office of the Attorney General has authority to prosecute any business that engages in price gouging after an emergency has been declared by the governor.
If you feel that you are being unfairly charged for goods or services after an emergency for a necessity, raise the issue of price gouging with the provider. If you are unable to resolve the matter, file a complaint with our office.
See Price Gouging page for more information.
Door-to-Door Contractors
After natural emergency’s, door-to-door contractors flock to some neighborhoods offering clean up and repair services. While many of these people are honest and reputable, some are not.
Protect yourself and your wallet from unscrupulous operators. If you are insured, call your insurance adjuster and have them make an estimate of the damage and probable repair cost. This will give you a benchmark estimate, prepared by a professional, when you negotiate with contractors.
If someone does come to your door and offers to do repairs, consider doing the following:
- Get more than one estimate. Don't be pushed into signing a contract right away. Take your time.
- Do your homework. Check the contractor out online and consider getting references from past customers.
- Get everything in writing and keep a copy of all documents. The total cost, work to be done, schedule, payment terms, and other expectations should be written in specific detail. A notice of cancellation - giving you the right to change your mind within three business days - must be included if the transaction occurs at your home.
- Do not sign a contract with blanks. Unscrupulous salespeople could enter unacceptable terms later.
- Ask for proof of insurance. Make sure that the contractor has disability and workers' compensation insurance. If the contractor is not insured, you could be liable for accidents on your property.
- Find out in writing if the contractor or business will place a lien, security interest or mortgage on your property.
- Ask for guarantees in writing. If the contractor provides guarantees, they should be written into the contract, clearly stating what is guaranteed, who is responsible for the guarantee (the dealer, the contractor, or the manufacturer), and how long the guarantee is valid.
- Don't sign completion papers or make final payment until the work is completed to your satisfaction. A reputable contractor will not threaten you or pressure you to sign if the job is not finished properly.
REMEMBER: Special laws apply if a contractor from another area is working because of damage or destruction to property caused by an emergency. These emergency remediation contractors, with some exceptions, are NOT allowed to require payment before beginning work or even after work has begun if it exceeds an amount proportionate to the work performed.
Be especially suspicious of door-to-door salespeople who make "low-ball" estimates, or refuse to leave a contract overnight so you have time to review it.
See Home Repair Scams and Door to Door Scams page for more information.
Charities
In the wake of a natural emergency you may want to assist by giving to a charity that provides assistance to victims. We commend your generosity, but urge you to make sure your donations go to legitimate organizations.
It is wise to give only to charities you are already familiar with. Most reputable organizations do not directly solicit donations from individual consumers by telephone or door-to-door visits. Do not use links embedded in unsolicited emails to access an organization's website.
The following resources can help you research charities:
- CharityWatch formerly known as The American Institute of Philanthropy, is a charity watchdog group which helps donors make informed choices.
- Guidestar gathers data on millions of IRS-recognized non-profits.
Other Scams
Of course, following a natural emergency many other scam artists may be looking to take advantage of a vulnerable population. Be aware of other common scams.