N.Y. Attorney General probes Sandy price gouging

• Hundreds of reports of price gouging, including $10 for box of matches and $7 for a loaf of bread
• State probe focuses on 'sharp, unwarranted increases' in prices by grocery stores, hotels and taxis
• Retailers can defend price hikes if they prove their suppliers increases their costs for delivery of goods

ALBANY, N.Y. (AP) — More than 500 possible cases of price gouging of gasoline and other essentials, including a $10 box of matches and $7 loaf of bread, have been reported in New York before and after Superstorm Sandy.

Reports are being investigated in New York City, the Hudson Valley and on Long Island by state Attorney General Eric Schneiderman. More than 300 reports were made over the weekend and Monday, and the total is rising.

Schneiderman said Monday that he's investigating an increasing number of reports of spikes in prices for essential goods including gasoline, food, bottled water, generators, batteries and flashlights. The probe can include sharp, unwarranted increases in prices by retailers, including supermarkets, hardware stores, bodegas, delis, hotels and taxis, he said.

New Yorkers can report price gouging by telephone at 800-771-7755 or through his office website at www.ag.ny.gov.

"We are actively investigating hundreds of complaints we've received from consumers of businesses preying on victims of Hurricane Sandy," Schneiderman said. "Our office has zero tolerance for price gouging."

In one report, the cost of a bag of potatoes jumped to $7, up from $3 before the storm hit. The cost of the box of matches appears more than three times the usual cost, and the loaf of bread is more than double the usual cost.

Vendors may defend higher prices if they can show an increased cost of obtaining goods from wholesalers or in delivering services, making prosecutions difficult.

Schneiderman offers the following tips for consumers to ward off gouging in repairs from Sandy:

• Ask for references and check for licenses.

• Get estimates in writing and agree to added costs only in writing.

• Homeowners have a three-day period to cancel a contract, unless the repair is an emergency.

• Verify a contractor's address.

• Never pay full price up front. Withhold final payment until the project is done satisfactorily.

• Be sure the contractor has valid insurance so you aren't liable for any injuries on the job.

• Secure building permits before the job starts.

No arrests were reported as of Monday. Schneiderman wouldn't discuss details of the reports or the investigation.

State law prohibits an "unconscionably excessive price" during an "abnormal disruption of the market" that unfairly takes advantage of consumers.

Last summer, Schneiderman sued some gas stations for price gouging following Tropical Storm Irene. The reports of price gouging were relative low during that storm, which ravaged parts of upstate New York.

Schneiderman had sent warning letters to major vendors before Irene and before Sandy.

In August, a Yonkers gas station increased its price from $3.89 a gallon before Irene hit to $4.79 two days later, drawing from the same delivery of gas received before the storm hit. The station lowered the price again, to $3.83, when Irene left. The company settled the suit without admitting guilt for $7,500, Schneiderman said.

A Farmingdale gas station on Long Island raised its price 84 cents per gallon when Irene hit. That gas station settled the lawsuit against it for $3,000.