DCWP Analysis Shows Price Gouging Preys on Vulnerable New Yorkers | City of New York

Consumer and Worker Protection


8 Months and 10,000+ Complaints Later: Department of Consumer and Worker Protection Analysis Shows Price Gouging Preys on Vulnerable New Yorkers

November 9, 2020

Department’s Analysis Shows Price Gouging is More Common in Neighborhoods Hardest Hit by COVID-19 and Financially Vulnerable Communities of Color

NEW YORK, NY – Department of Consumer and Worker Protection (DCWP) Commissioner Lorelei Salas today announced that, after analyzing the more than 10,000 complaints about price gouging, the neighborhoods with the most complaints are many of the same neighborhoods that were hardest hit by COVID-19. These neighborhoods, which are majority Black and Hispanic, are already financially vulnerable and, with median household incomes of approximately $30,000, can least afford to be gouged on lifesaving items like face masks, hand sanitizer, and disinfecting wipes.

“To see that racial and economic disparities extend even to price gouging is disheartening,” said DCWP Commissioner Lorelei Salas. “So many of the Black and Brown New Yorkers in these neighborhoods work on the frontlines—especially in low-wage service industries like grocery stores and restaurants. Complaints have slowed but as our city reopens and some supply chains across the country continue to face challenges, businesses—especially those in these neighborhoods—must continue to comply.”

Since March 5, DCWP has received more than 12,000 price gouging complaints and issued more than 15,200 violations for price gouging. The number of complaints received weekly has slowly declined since reaching a peak of 2,108 in mid-March and the Agency now receives a few dozen complaints per week. Some of the most egregious violations include selling 8 oz. bottles of hand sanitizer for $27.99 and selling N95 masks for $20.00 per mask. DCWP will continue to actively inspect stores based on consumer complaints while the state of emergency is in effect.

To date, about half of the businesses that received violations have resolved the violations either through settlements or decisions from Office of Administrative Trials and Hearings (OATH). DCWP also filed a total of eight cases against repeat offenders, settled with one for $25,900 and received three decisions resulting in orders to pay a total of $68,750 in fines.

Price gouging is illegal for any product or service essential to health, safety and welfare during a declared state of emergency. DCWP encourages consumers who are overcharged to file a complaint at nyc.gov/dcwp or by contacting 311 and saying “overcharge.” Consumers who believe they were victimized by price gouging should keep their receipts and any information about the store where the transaction occurred and file a complaint with DCWP.

Six months ago, DCWP promulgated an emergency Rule under the City’s Consumer Protection Law that makes price gouging illegal for any personal or household good or service that is needed to prevent or limit the spread of or treat COVID-19. On May 13, DCWP extended the Rule for an additional 60 days and, as part of the extension, proposed a new permanent Rule that contemplates future emergencies. The permanent Rule now makes price gouging illegal for any products or services essential to health, safety and welfare during a declared state of emergency. The fine for price gouging is up to $500 per item or service. If businesses are paying more to obtain these items themselves, they must provide proof to DCWP and any increase must be comparable. If a business paid $2 more per item, they cannot charge customers $50 more.

NYC Department of Consumer and Worker Protection (DCWP) protects and enhances the daily economic lives of New Yorkers to create thriving communities. DCWP licenses more than 59,000 businesses in more than 50 industries and enforces key consumer protection, licensing, and workplace laws that apply to countless more. By supporting businesses through equitable enforcement and access to resources and, by helping to resolve complaints, DCWP protects the marketplace from predatory practices and strives to create a culture of compliance. Through its community outreach and the work of its offices of Financial Empowerment and Labor Policy & Standards, DCWP empowers consumers and working families by providing the tools and resources they need to be educated consumers and to achieve financial health and work-life balance. DCWP also conducts research and advocates for public policy that furthers its work to support New York City’s communities. For more information about DCWP and its work, call 311 or visit DCWP at nyc.gov/dcwp or on its social media sites, Twitter, Facebook, Instagram and YouTube.

Abigail Lootens | Melissa Barosy

(212) 436-0042