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A natural disaster leaves more than torn shingles and uprooted lives in its wake. Ill winds can also blow in armies of fly-by-night
contractors and door-to-door scam artists, eager to capitalize on the misfortunes of decent people.
Disaster cons and frauds take many forms. Some businesses raise their prices unconscionably, to take advantage of people needing bottled
water, ice, groceries, towing services, home and car repairs, fuel, or other essential goods and services. Unscrupulous home repair services flourish in the wake of a disaster. Bogus charities spring up
to take advantage of the public outpouring of generosity and compassion for disaster victims. And solicitors may advertise that they can get big insurance settlements for disaster victims — for a
fee.
If you are the victim of a hurricane, flood, tornado, or other disaster, exercise extreme caution. It's bad enough to have to cope
with the destructive force of nature. Don't let a scam artist victimize you a second time. Be prepared, and know your rights.
Price Gouging is Illegal
Price-gouging refers to the practice of charging excessively high prices for goods or services to take advantage of individuals affected
by a disaster. For example, when massive floods inundated parts of Southeast Texas in 1994, many consumers complained about businesses charging excessive prices on such necessities as drinking water,
carpet cleaning, car rentals and towing jobs.
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 a natural disaster has been declared by the governor. Attorney General Morales has issued stern warnings about price-gouging to businesses in
times of disaster, but you should still be on your guard.
If you feel you that you are being unfairly charged for a good or service such as drinking water or a towing job, raise the issue of
price-gouging with the provider. Speak to him or her in a frank and respectful manner. If you are unable to come to a friendly resolution of the matter, you may file a complaint with the OAG by calling
our Consumer Protection Hotline at (800) 337-3928 or e-mailing our Citizens Assistance division at: cac@oag.state.tx.us.
Door-to-Door Clean-up and Repair
After a flood, a hurricane, or a severe storm, salespeople may go from door to door in a neighborhood, offering clean-up and repair
services. While many of these people are honest and reputable, some are not.
There are several things you can do to protect yourself – and your wallet – from the unscrupulous operators. If you are
insured, call your insurance adjuster and have him or her make an estimate of the damage and probable repair cost. That way you'll have a benchmark estimate, prepared by a professional, when you
negotiate with contractors.
If someone does come to your door and offer to do your repairs, we suggest that you at least do the following:
Get more than one estimate. Don't be pushed into signing a contract right away.
Check the contractor out with the Better Business Bureau. Ask if there are any complaints about the company.
Get references from past customers. Check them out.
If the salesperson is unknown to you, write down his or her driver's license number. Also note the salesperson's license
plate number.
Avoid out-of-town businesses. If the repair job turns out to be substandard, how will you have problems corrected or get your money
back?
Get everything in writing and keep the documents in a safe place. The total cost, work to be done, time schedule, payment terms, and
other expectations should be noted in specific detail. A notice of cancellation—giving you the right to change your mind within three business days—must be included.
Do not sign a contract with blanks. Unscrupulous salespeople may enter unacceptable terms later.
Ask for proof of insurance. Make sure that the contractor has disability and workers' compensation insurance. You may be liable
for accidents on your property if the contractor is not insured.
Never pay 100 percent up front. Arrange for an independent agent (insurance adjuster or real estate inspector) to inspect the
completed work before you make full payment.
Find out in writing if the contractor or business will place a lien, security interest or mortgage on your property.
Ask for any 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 off before the job is finished.
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.
In summary, be cautious and take your time. Be especially suspicious of door-to-door salespeople who make "low-ball"
estimates, refuse to leave a contract overnight, or try to sell their services to you by playing on your emotions.
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