Attorney general warns of scams, price gouging after flooding

(From Attorney General Chris Koster)

Attorney General Chris Koster warned consumers to be on the lookout for price gouging and other storm-chasing scams after heavy rains and flooding occurred throughout Missouri.

“My office stands prepared to protect Missouri consumers impacted by severe flooding,” Koster said. “We encourage anyone with flood or other storm-related property damage to be alert for scammers who follow weather disasters and prey on consumers needing repair or cleanup work.”

Storm chasers typically go door-to-door and use high-pressure sales tactics when offering repair or cleanup services. The scammers may arrive from out-of-state and be unable to show local references or prove they are locally bonded or licensed. They may claim to specialize in services like flood repairs or restoration and attempt to convince consumers to sign a contract that lets the scammers negotiate directly with the homeowner’s insurance company. Storm chasers often take payments up front, provide shoddy or no work, then flee the region.

Koster also warned of potential price gouging, the excessive and artificial raising of prices during an emergency for necessities like water, food, gasoline, and cleanup equipment. Price gouging is illegal in the state of Missouri.

Koster offers the following tips to avoid becoming the victim of scams or fraud following natural disasters:

• Beware of fake disaster officials. This is a common ploy for burglars or people pushing expensive or unnecessary repairs. Ask for identification from anyone who claims to be a government official.
• Contact your insurance company before moving ahead with repairs by a contractor. Some insurance companies require an adjuster's pre-approval for work to be covered under their policies.
• Watch out for brokers who promise so-called “guaranteed” loans from FEMA, especially if they ask for payment up front. FEMA does not charge an application fee. Verify the credentials of people offering low-interest government loans, and contact the agency directly to verify the person’s employment.
• Do not prepay for work. Inspect the work and make sure you are satisfied before you pay. A reasonable down payment may be required for some projects, but don’t pay anything without getting a written contract. Avoid paying with cash; use a check or a credit card instead.
• Beware of any contractor who tries to rush you or who comes to your home to solicit work. If an offer is “only good now or never,” find someone else to perform the work.
• Seek recommendations from friends, neighbors, co-workers, and others who have had work performed on their homes in the past. Do not hire any person without asking for, and checking, references.
• Get three written estimates for the work, if possible, and compare bids. Check credentials and contact the Attorney General’s Office and the Better Business Bureau to learn about any complaints against the contractor. Before work begins, make sure you get a written contract detailing all the work to be performed, its costs, and a projected completion date.
• Beware of charity scams that use recent storms to make their phony pleas for donations sound more plausible. If a caller refuses to answer your questions about the charity; offers to come to pick up a donation in person; or calls you and asks for a credit card, bank account, or Social Security number, it may be a scam. To report telemarketing fraud, call the Attorney General's Office.
• Report price gouging.  Missouri law is clear—price gouging is illegal and the Attorney General’s Office will investigate and prosecute price gouging to the full extent of the law. Any person who believes a business has suddenly and artificially raised the prices on necessities should contact the Attorney General’s Office.

Consumers can file and search complaints and check charities online. Consumers also may contact the Attorney General's Consumer Protection Hotline at 800-392-8222 with questions or to file a complaint.