McCollum, Bronson Reach Deal with Morgan Stanley
The state has reached a $2.27 million settlement with Morgan Stanley Capital Group Inc. over price gouging accusations that occurred last year in the aftermath of Hurricane Ike.
Attorney General Bill McCollum and Agriculture and Consumer Services Commissioner Charlie Bronson launched a joint investigation last fall when gas prices around the state skyrocketed and residents reported seeing prices above $5. Florida’s price gouging law goes into effect during declared emergencies and is aimed at preventing businesses from raising prices in the wake of a disaster dramatically over what they were before the disaster.
Morgan Stanley, a wholesaler of motor fuel in Florida, and its subsidiary TransMontaigne, were among the targets of the investigations. McCollum said Morgan Stanley was following market prices and did not believe it had broken the law.
Under the settlement, Morgan Stanley did not admit to wrongdoing but agreed to pay the state $2.27 million, which McCollum said was the biggest price gouging settlement in the state's history.
“This is a statement that big business has to be held accountable,” McCollum said.
Bronson said the two offices are continuing to jointly investigate 12 other companies they suspect of price gouging, but did not set a timeline for that process to conclude.
He added that the state did not want to hurt the individual retailers who had faced the initial high prices from suppliers and were simply passing that expense on to the customer.
“We don't want to hurt the gas station owner who did not purposely violate the law that way and they had no other option but to sell at the price that they bought their fuel,” Bronson said.
The money the state receives in the settlement will be split between McCollum's and Bronson's offices and be used to fund future gouging investigations, which are not specifically funded in the budget. The offices have not done an official tally yet on how much the Morgan Stanley investigation cost the state, but a lawyer for McCollum's office estimated a six-figure total.