There's turning a profit and then there's price gouging. A company selling masks in Calgary recently discovered the not-so-fine line between the two and disputes charges against him. After a tip from the Report a Rip-Off Line, investigators learned that this business had been selling things like masks, hand soap, Lysol, and more for up to 400% more than people should reasonably pay for them.
According to a release from Service Alberta, the anonymous tip from their line led Service Alberta’s Consumer Investigations Unit to look into it.
On April 1, a CIU investigator went to the business called CCA Logistics Ltd.
They found that there were "several pieces of personal protection equipment...being sold at prices that grossly exceeded their normal selling price."
Some examples of what they were selling reads like a pandemic most wanted list.
They were selling 3M masks for $120, which is a 400% markup.
Lysol spray was $25 or basically 250% more than you should pay. That happened in Vancouver, too, one couple got their Amazon store shut down because they were reselling Lysol and claimed to make six-figures from it.
So, they issued an order on April 15 that said the business had to stop charging these outrageous prices. Service Alberta said that they did not comply with the order, but business owner Yan Gong said they did.
Now, the owner of the business has a court date. If they're found guilty, they could face fines of up to $300,000.
“I'm not in the PPE business before, but we're in supply chain business so I feel it's my responsibility to start working to provide these essential supplies to the public,” said Gong speaking to Narcity.
"When they say we didn't obey the order, we did, we immediately ceased the selling of any of the items they pointed out," he said.
Gong said that there could be a misunderstanding and he's eager to speak to a judge about this issue. Service Alberta wasn't clear about the items they were accused of price gouging.
According to Service Alberta, the business was also selling hand sanitizer for $39 at 200% mark up and hand soap for $10 at a $300% mark up.
Gong says that the $39 hand sanitizer was for one litre and says that his company has competitive prices because they negotiate with sellers and suppliers constantly to get customers the best price.
"Why would we want to make a couple more bucks just to take advantage of people who don't know the price?" he said.
Alberta's COVID-19 restrictions are loosening but it's possible that we won't see demand for these pandemic must-haves go away for a long time.
Given that he doesn't advertise prices and claims to often eat shipping and storage costs involved with bringing in personal protective equipment to the province, Gong wants to speak loudly to the courts and see if everyone agrees with Service Alberta about this price gouging.