Rent gouging reported; prosecution may be hard

The San Diego County District Attorney's Office is checking numerous reports of rental-rate price gouging in areas hit hard by wildfires, but so far, few cases are expected to result in prosecutions.

“I'm getting a lot of rumors and we are tracking every one of them down, but we are not getting a whole lot of confirmation,” said Deputy District Attorney Tricia Pummill, who works with the Economic Crimes Division.
“In each situation we have to determine what the (rental) price was before the disaster. . . . We are jumping on these. They are not sitting on someone's desk.”
Most reports of higher-than-normal rents have been in the Rancho Bernardo area. Investigators must determine if recent home improvements justify price increases, she said.
The San Diego County Apartment Association has posted a notice at sdcaa.com warning landlords that raising rents by more than 10 percent during a declaration of emergency is a crime punishable by a $10,000 fine or up to a year in jail, or both. The rent restriction remains in effect for 30 days.
The law also applies to people who sell essential goods, such as food, emergency supplies, medical supplies, building materials and gasoline, he said. It covers repair or reconstruction services, emergency cleanup services, transportation, freight and storage services and hotel accommodations.
At The Reserve apartment complex in 4S Ranch, 15 apartments were leased to two corporate housing companies soon after the wildfires. Such companies often furnish leased apartments and rent them out to individuals, corporations and insurance companies.
The corporate housing firms have raised their rents beyond 10 percent of what The Reserve had been charging for the unfurnished units, said General Manager Lisa Mason.
Joe Porpiglia, chief operating officer of National Corporate Housing, said that's legal and in keeping with the money that was spent to provide those units with furniture, computers and housewares.
“We are very comfortable if the governor or anyone else wants to look at our markup,” he said.
The Reserve still has regular unfurnished units available, Mason said. Outside the hardest-hit wildfire areas, apartment rental rates countywide probably won't be affected by the disaster, said Robert Pinnegar, executive director of the apartment association.