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VCU professor shares tips on how to spot price gouging

'Don’t overbuy, and that actually prevents this gouging possibility because the supply doesn’t get exhausted'
How to report gas price gouging if you see it
Posted at 5:10 PM, May 12, 2021
and last updated 2021-05-12 20:24:02-04

RICHMOND, Va. -- Lawmakers and state leaders are urging Virginians to be aware for the potential of business owners to take advantage of the increase in demand for gasoline.

Tuesday, Governor Ralph Northam declared a state of emergency following a cyber-attack on one of the main arteries that supplies our state with gasoline.

Experts said panic buying is leaving gas stations up and down the East Coast without fuel this week.

Jeff Smith is chair of Information Systems and Supply Chain Management at VCU’s School of Business.

CBS 6 asked Smith how does the average consumer spot a bad actor during the state of emergency?

“You are allowed to raise prices as you have less supply. That’s not uncommon. The problem is when the price increases comes exorbitant,” he explained.

Woody Alasad sold his remaining gas supply at $2.85 for a gallon of unleaded gas. He had no plans to increase prices either.

“It’s not appropriate to do that,” Alasad responded. “To take advantage of the community, that’s not right.”

Smith detailed what would be considered price gouging if Alasad did decide to raise his price for a gallon of gas.

“You would look to be $3.20, $3.40, maybe even up to $3.50 is still going to be within legal acceptable bounds. But, once you start pushing over $4.00 — now we still need to be thinking something is abnormal.”

Virginia’s Attorney General’s Office urged consumers to report any possible instances of price gouging. You can contact the Consumer Protection Section at consumer@oag.state.va.us or (800) 552-9963.

Smith warned to expect a disruption like this to happen again.

“This instance is going to be, in my opinion, more common where you see more cyber attacks against our infrastructure,” he explained.

His best advice: don’t panic.

"I know the rational activity is to go out and automatically buy gas,” Smith said. “Don’t overbuy, and that actually prevents this gouging possibility because the supply doesn’t get exhausted.”

The public should also file motor vehicle fuel price gouging complaints with the Va. Dept. of Agriculture and Consumer Services' Office of Weights and Measures by completing the complaint form that can be downloaded from the VDACS website at http://www.vdacs.virginia.gov/pdf/pricegouging.pdf and then sending the form to owm@vdacs.virginia.gov

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