Coronavirus: Calgary business charged with price gouging, Service Alberta says

Click to play video: 'Calgary business owner defends prices amid gouging investigation'
Calgary business owner defends prices amid gouging investigation
WATCH: The owner of CCA Logistics says his prices on masks and other COVID-19 supplies are fair. This as Alberta’s Consumer Investigations Unit has charged the owner with price gouging. Michael King reports. – May 9, 2020

The Alberta government has charged a Calgary business with price gouging during the COVID-19 pandemic, according to a Service Alberta news release issued Friday.

Service Alberta said CCA Logistics Ltd. ignored an order to “stop charging exorbitant prices for several consumer products.”

An anonymous tip to the Report a Rip-Off line prompted Service Alberta’s Consumer Investigations Unit to step in.

On April 1, Service Alberta said a CIU investigator went to CCA Logistics Ltd. and found several items “being sold at prices that grossly exceeded their normal selling price,” including:

  • 3M masks – $120 (400 per cent markup)
  • hand sanitizer – $39 (200 per cent markup)
  • two-pack of Vitamin C – $30 (100 per cent markup)
  • hand soap – $10 (300 per cent markup)
  • Lysol spray – $25 (250 per cent markup)
Click to play video: 'Calgary-based business charged with price gouging: Alberta government'
Calgary-based business charged with price gouging: Alberta government

On April 15, an interim director ordered the business to stop charging “grossly” excessive prices “for which similar goods were available,” but the store did not comply, according to Service Alberta.

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The government said the business owner is scheduled to appear in Calgary provincial court on Aug. 19.

Yan Gong confirmed to Global News that he is the owner of CCA Logistics, the business accused of price gouging, but said he disputes the allegations against him.

“If my price is not fair, how come the majority of my clients… they are big companies… institutions in some schools, some non-profit organizations — why do they want to purchase through us?” he asked.

Gong added that supply chain issues are a key factor in why his prices have gone up.

“You can ask any supplier in town, can you get 3M masks? Probably no,” he said. “If you’re lucky, someone kept a couple of them in their house. Ask them how much you want to sell them for.”

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‘Unacceptable and reprehensible’

As of May 8, the CIU said it has received 458 complaints about price gouging related to COVID-19 at businesses across Alberta and 351 have been flagged for further investigation.

“We have been very clear that taking advantage of Albertans is unacceptable and reprehensible, especially during a public health emergency,” said Service Alberta Minister Nate Glubish in a statement.

“As customers, Albertans should be able to shop with confidence, without needing to worry about businesses engaging in acts of piracy.

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“Unnecessarily hiking prices by 200 and 400 per cent is disgusting behaviour that will be punished 100 per cent of the time.”

CCA Logistics Ltd. in northeast Calgary, Alta., pictured on Friday, May 8, 2020. Tom Reynolds/Global News

Glubish said Service Alberta takes complaints seriously​, and they have spiked since the pandemic began.

“I hope this sends a strong signal to all Albertans that you will not get away with breaking the law. You will not get away with an act of piracy and taking advantage of Albertans in the middle of a uncertain and fearful time,” he said.

“This behaviour is unacceptable whether we’re in a pandemic or not.”

Glubish said the vast majority of Alberta businesses are doing their best to serve customers during this trying time.

“This is just a very small number of bad actors,” he said, “but if you encounter one, we want to know about it and we will take action to protect you.”

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Allegations of price gouging have surfaced among many items, including hand sanitizer, Lysol/Clorox Wipes, toilet paper, masks, disposable gloves, soup, flour, milk, baby formula, shredded cheese and ground beef, according to Service Alberta.

“The CIU reviews each complaint and will initiate an investigation if there is clear evidence of price gouging,” Service Alberta said.

“If found guilty, a company could face fines up to $300,000.”

‘Lay down the law’

Alberta Premier Jason Kenney ​had “harsh words” for people who would exploit a crisis and charge “outrageous” prices.

“A crisis like this brings out the best in most people. Sadly, it also brings out the worst in some folks,” he said.

“If you think you’re going to gouge your fellow Albertans with ridiculous price increases, exploiting the pandemic, you’ve got another thing coming. We’re going to go after you and throw the book at you, lay down the law and protect consumers against price gouging.”

Kenney said it was the first charge laid, among hundreds of active investigations.

“We will leave no stone unturned to bring the full force of the law to those who are seeking to exploit their fellow Albertans through price gouging,” he said.

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Gong said he believes Kenney’s words weren’t meant for him.

“The harsh words he said is not me,” he said. “He is saying something towards some bad guy who does a bad thing but not me.

“I want to stand on the stage in court and speak out loudly to the judge and see what he thinks we should do right now.”

Click to play video: 'Kenney says the province will go after price gougers after Calgary company charged'
Kenney says the province will go after price gougers after Calgary company charged

If you spot unreasonable prices, call the Report a Rip-Off line at 1-877-427-4088 or file a consumer complaint here.

– With files from Global News’ Michael King

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