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State AGs Attack Virus Scams and Price Gouging

State AGs Attack Virus Scams and Price Gouging

Senior Director of Strategic Alliances
LexisNexis Risk Solutions - Government

“The bigger the event, the greater the scams,” according to Todd Leatherman, program counsel for the National Association of Attorneys General (NAAG) Training and Research Institute. That’s abundantly evident in the barrage of COVID-19 fraud schemes and ruthless price-gouging currently afflicting the public in the midst of the Coronavirus pandemic.

Fortunately, State Attorneys General are well-positioned to investigate these crimes, prosecute the fraudsters, and send a strong message to other would-be perpetrators. States can act quickly when fraud is taking place in their jurisdictions; for example, Missouri was the first state to file suit against Televangelist Jim Bakker, who operates out of Branson, for hawking a silver solution as a phony “miracle cure” for COVID-19 and other ailments. The lawsuit resulted in swift removal of the solution (which sold for as much as $125) from Bakker’s website. The Federal Trade Commission and Food and Drug Administration had also warned Bakker to stop selling the snake oil, and the New York AG issued a “cease and desist” letter.

State AGs are seeing widespread price gouging rising to ridiculous levels. The New York AG ordered a Manhattan Ace Hardware store (charging $79.99 for a bottle of hand sanitizer) and an Astoria market (charging $14.99 for a bottle of disinfectant spray) to stop charging excessive prices. Emergency price gouging laws are in effect in more than 30 states, which gives AGs more leverage over these opportunists.

NAAG has established a website where consumers can report COVID-19 scams, fraud, and price gouging with each state attorney general’s office. (The faster these crooks are reported, the sooner the states can put them out of business.)

Today’s Fraud of the Day comes from a Route Fifty article, “State AGs Crack Down on Coronavirus Scams,” published Mar. 16, 2020.

From disgraced televangelist Jim Bakker in Missouri to a convenience store operator in New Jersey, suspected fraudsters are trying to take advantage of the coronavirus panic to trick consumers into buying useless or harmful products, triggering state anti-gouging laws and anti-fraud efforts by state attorneys general.

“When people are desperate and afraid, they are more likely to make a bad financial decision,” Democratic North Carolina Attorney General Josh Stein, co-chairman of the National Association of Attorneys General Consumer Protection Committee, said in an interview with Stateline.

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