Consumer News Release
For immediate release - Friday, May 28, 2004
Contact: Bill Brauch (Office of A.G.): 515-281-8772
Chris Coleman (Iowa BBB): 515-202-8845
Avoid Flood-Related Consumer Scams
Attorney General joins forces with Better Business Bureau to warn Iowans against home repair and other scams targeting flood victims.
DES MOINES. Attorney General Tom Miller and the Iowa Better Business Bureau today warned Iowans to be wary of consumer scams that sometimes strike in the wake of natural disasters such as the flooding experienced in Iowa this past week.
"Home repair con-artists sometimes move in after a disaster because the conditions may give them an edge," Miller said. "There may be hundreds of people who are eager to get cleanup or repairs done, there may be a shortage of local contractors to do all the work, there may be money around because of disaster or insurance payments, and people may be in a rush to get back to normal."
Miller and Chris Coleman, President of the BBB, cautioned Iowans to be especially careful about contractors coming to their door and asking for advance payment for cleanup or repairs. "That's a recipe for rip-off. They may take your money and run and do little or no work," Coleman said.
Miller and the BBB offered these tips to avoid being victimized by flood recovery schemes:
- Work with reputable local contractors;
- Get several estimates;
- Get a written contract spelling out all details and costs;
- Don't pay large sums in advance, unless necessary to purchase needed supplies, and then make sure to get a lien-waiver from all suppliers or pay the suppliers directly;
- Call the Attorney General's Consumer Protection Division at 515-281-5926 and the Iowa BBB at 800-222-1600 to check the contractor's complaint history.
Miller also encouraged consumers to contact the Consumer Protection Division if they have complaints about price gouging - charging exorbitant and unjustified prices for products or services that are necessary for disaster victims.
Iowa regulations make price gouging illegal when a disaster declaration is in effect, as it is for 61 Iowa counties. (Price gouging is defined in the Attorney General's Administrative Rule as raising prices unreasonably above the price at which the merchandise or service was sold in the usual course of business immediately prior to the onset of the emergency. The Rule recognizes that prices may be higher because sellers also often incur increased costs. The Rule applies during the emergency declaration and "subsequent recovery period" up to six months.)
Miller and the BBB said that other scams sometimes crop up in connection with natural disasters - charity scams (fraudulently soliciting donations for bogus charities purportedly to help disaster victims), advance-fee loan scams (taking money in advance supposedly to arrange a guaranteed loan but never providing the loan), and con-artists presenting themselves as utility or government officials to get into people's homes for purposes of theft or other scams.
"Unfortunately, con-artists have earned a reputation for preying on people when they're down," Miller said. "Cheating flood victims is the definition of adding insult to injury. People need to be careful as the waters go down and recovery gets into full swing."
Miller emphasized that he is hopeful that flood-related consumer scams can be avoided in Iowa. "Iowans are smart consumers. People have worked hard to reduce the number of homes damaged and the amount of damage, and I'm hoping we have a sufficient number of reputable local contractors to handle the work. I think the con-artists may conclude that this is not good territory for them to try their schemes," he said.
Miller and the BBB also emphasized the need for all Iowans to be on the lookout for weather-related recovery scams, even if they live in counties not subject to disaster declarations. Counties included thus far in the Governor's disaster declarations include: Adair, Adams, Allamakee, Audubon, Benton, Black Hawk, Boone, Bremer, Buchanan, Buena Vista, Butler, Calhoun, Cass, Cedar, Cerro Gordo, Chickasaw, Clay, Clayton, Clinton, Dallas, Delaware, Dubuque, Fayette, Floyd, Franklin, Fremont, Grundy, Guthrie, Hamilton, Hancock, Hardin, Howard, Humboldt, Iowa, Jackson, Jasper, Johnson, Jones, Kossuth, Linn, Lucas, Madison, Marion, Marshall, Mills, Mitchell, Montgomery, Page, Palo Alto, Pocahontas, Pottawattamie, Polk, Sac, Shelby, Story, Tama, Warren, Winnebago, Winneshiek, Webster and Wright Counties.
Additional resources are available at the Attorney General's Internet website: www.IowaAttorneyGeneral.org and the Iowa BBB's Internet website: www.desmoines.bbb.org.
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