Price Gouging Won't Stand in Times of Crisis

Gas prices can rise sharply immediately following a supply interruption like that which occurred in the Gulf of Mexico after Hurricane Katrina. But in the aftermath of major events such as a natural disaster, terrorist attack, or geo-political instability in oil producing countries, Americans who are the victims of these events should not also become the victims of price gouging.

The Gasoline Consumer Anti-price-gouging Protection Act (S. 94) will protect American consumers from dishonest suppliers of gasoline. The measure makes it unlawful to raise the price of gasoline to an unconscionable level during times of crisis. Twenty-eight states have enacted price gouging laws that are carefully crafted to meet their unique local circumstances. The bill supplements existing state laws by creating strict Federal price gouging language, enforced by the Federal Trade Commission (FTC) and the Department of Justice (DOJ). This legislation closes the existing regulatory gap by combating regional and multi-state violations of price gouging with substantial civil and criminal penalties. It would permit civil penalties up to $500,000, in the case of an independent small business and up to $5,000,000 for other suppliers. Criminal penalties of up to two years imprisonment would be authorized for persons in violation of this law. The bill also provides suppliers of gasoline the flexibility to adjust prices, as necessary, during a crisis to maintain the free flow of commerce, while still protecting consumers from exorbitant and unjustified price hikes.