The New Jersey Consumer Fraud Act
The New Jersey Consumer Fraud Act, N.J.S.A. 56:8–2 (NJCFA), provides that:
“[t]he acts, use or employment by any person of any deception, fraud, pretense, false promise, misrepresentation, or the knowing, concealment, suppression, or omission of any material fact with the intent that others rely upon such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise …” is an unlawful practice.
There is nothing worse than falling victim to fraud. It destroys your faith in everything. You begin to believe the whole world is dishonest and there’s not much you can do about it. Sadly, you are not alone. And the consumer fraud statistics prove it.
According to a Federal Trade Commission report, consumers reported losing more than $5.8 billion to fraud last year, a 70 percent increase over the previous year. Almost 2.8 million consumers filed a fraud report to the agency, the highest number on record since 2001. About 25 percent of those scams led to a financial loss of a minimum of $500.
However, other forms of fraud were costlier on a per-person basis — investment fraud cost $3,000 per victim in 2021. Business and job-opportunity scams cost the typical victim almost $2,000.
Covid-19 was a fertile fraud climate. Con artists galore preyed on consumer fear and confusion. The attacks were endless, from fake health products to stolen unemployment data. It seems the criminal determination to defraud an unsuspecting public is alive and well, no matter how dire the situation is.
Luckily for people and businesses in New Jersey, the state has one of the country’s strongest and most inclusive consumer fraud protection laws. It covers a wide variety of situations and industries, including businesses-to-business fraud. The following examples represent the tip of the consumer fraud iceberg.
The Auto Industry
Protection under the New Jersey Consumer Fraud Act applies to sales, leases, financing, and repairs of automobiles as infractions.
- Lying about the terms of financing
- Using “bait and switch” advertising tactics
- Selling a damaged or defective automobile
- Lying about the vehicle’s warranty
- Lying about the repair history or condition
- Lying about the price, including using hidden or undisclosed fees
- Charging excess fees (higher fees than were incurred)
- Misrepresenting the price of a vehicle in an advertisement
- Misleading advertisements or statements
- Odometer rollbacks and VIN switches
Home Improvement Industry
You hired a contractor. Not only did they not complete the project as promised, but the work was poor, and worst of all, they disappeared after one or two visits to be seen no more. You can probably think of several more. According to the NJ Consumer Fraud Act, a contract is a contract, and if the contractor has breached it in any way, you, as a consumer, are entitled to triple the damages and reimbursement of attorney fees.
All home improvement contracts must be in writing and include the following:
- The name and address of the contractor
- Start and stop dates
- A description of all work to be done
- A description of the supplies to be used
- All warranties
- The contractor’s license number with the DCA
- A copy of the contractor’s general commercial liability policy and the insurance company’s phone number
- The total price, including fees and finance charges
- Specific language allowing for cancellation of the contract by the homeowner and refunds of amounts paid
- Health club contracts must be in writing
- The customer must be given a written copy of the contract
- It must conspicuously contain the total price
- The contract must state that a bond, irrevocable letter of credit, or other security is filed with the DCA
- The contract cannot be for more than three years
- It must provide that the customer can cancel the contract within three days of signing and get a refund
- The contract must provide for cancellation upon the member’s death or permanent disability
- It must provide that the customer can cancel if she moves more than 25 miles from the club or an affiliate
- Members cannot be required to renew their contracts
- A health club cannot require or accept more than a 25 percent down payment
Both full-time and part-time employment agencies are governed by rules laid down in New Jersey’s Consumer Fraud Act. Violation of those rules may initiate liability depending on the circumstance.
- An employment agency must be duly licensed by the state of New Jersey
- It cannot use deceptive or misleading advertising
- All contracts between the employment agency and a job seeker must be in writing, and the agency cannot accept a fee without a written contract
- The contract must clearly state that it gives no guarantees of employment
- The contract must give the employee three calendar days to cancel
- The contract must clearly state all fees and clearly describe the services to be provided by the agency
- The agency must give the job seeker copies of every document they have signed
- It must post how the fees are to be paid by a job seeker and how they are computed
- The agency cannot charge a temporary employee fee for permanent employment unless a temporary position becomes a permanent one within 30 days
- Job seekers cannot be charged more than 1 percent per day of the fee on the schedule per day if they were discharged without cause or quit with just cause
- A job seeker who does not report for work or voluntarily quits without just cause within 30 days may not be charged more than 30 percent
- An agency cannot charge a job seeker a fee before finding them a job
- An agency cannot split fees paid by a job seeker with an employer
- Agencies cannot charge fees when an employee has not accepted employment
Other Industries. All the above should indicate what is required under the law when it comes to consumer rights and expectations. New Jersey’s Consumer Fraud Act aims to what is considered deceptive sales, applicable to many industries—real estate sales and services, internet dating agencies, banks and lending institutions, kosher and halal foods, pet purchases (frequently known as the “Puppy Lemon Law”), the service and repair of home appliances, personal information security, telecommunications, and information services.
You Just Realized You Were Scammed
Don’t accept it and think there’s nothing you can do about it. The New Jersey Consumer Fraud Act and The Law Offices of James W. Taylor are on your side. Let’s sort things out and get you the restitution you deserve.
We serve Jersey City, Newark, Bayonne, Paterson, Hackensack, or any other place in New Jersey—if you’re the victim of fraud, get in touch with The Law Firm of James W. Taylor, Jr., to discuss your case. We can help. Call 201-418-0143 or go to our website to book a free consultation today.
The Law Firm of James W. Taylor, Jr.
580 Newark Avenue, Jersey City, NJ 07306