Consumer fraud is a growing concern throughout the United States. The federal government has enacted several laws to help protect consumers nationwide, but individual states have also taken steps to identify unlawful acts within their boundaries and provide remedies for residents who have been defrauded. The New Jersey Consumer Fraud Act (the NJ Act) offers some of the best consumer fraud protection in the country and covers a variety of scenarios.
In general, the NJ Act makes it unlawful for merchants, contractors, and salespeople to mislead consumers through deceptive actions or omissions. In other words, A person or business actively violates the NJ Act by doing or saying something deceptive OR passively by failing to do or say something that deceives consumers.
An Example of Consumer Fraud from the Car Dealer Industry
Schlanger Law Group recently handled a case where a car dealer advertised a vehicle for sale but changed the deal when our clients tried to buy the vehicle. You can read more about our clients’ ordeal in this predatory car dealer article.
Automobile-related fraud is specifically mentioned in the NJ Act because dealerships, salespeople, and advertising materials often use questionable tactics to lure car buyers. Usually, the consumer is coerced into buying a different, more expensive vehicle. Examples of deceptive practices may include:
- Bait-and-switch advertising – when the featured vehicle is no longer available or the terms have changed,
- Falsifying the financing terms – claiming the consumer somehow doesn’t qualify for the advertised deal and increasing the interest rate or length of the loan,
- Lies or misrepresentations about the car’s condition, warranty coverage, prior accident or repair history, mileage, VIN, or recalls,
- Changing the price of the vehicle, related fees, warranty costs, upgrades, financing terms, or any other financial obligations after an agreement is reached, and
- Other misleading or outright false statements and advertising.
Each of these actions or misstatements may be considered a violation of the NJ Consumer Fraud Act. If you have fallen victim to predatory or misleading NJ dealership practices, you have rights. Our team of skilled lawyers can explain your rights during a no-obligation case consultation.
The New Jersey Consumer Fraud Act’s Main Objectives and Remedies
Enacted in 1960, the NJ Consumer Fraud Act was created to protect New Jersey consumers from many fraudulent and deceptive business practices. The Act’s three main objectives are:
- To punish deceptive or fraudulent actions that harm consumers and discourage the violator from continuing to act in unlawful ways,
- To provide compensation for consumers who have been harmed by these actions including treble damages (three times the amount of damages suffered by the consumer), and
- To create a financial opportunity that allows consumers to work with skilled attorneys who can protect their rights. Specifically, the Act requires the business or individual that violates the law to pay the consumer’s attorney’s fees and costs. A consumer’s lack of funds is therefore not a barrier to the legal system and consumer protection.
A business or person that violates the NJ Act must also refund any money they received from their unlawful actions. Usually, as a consumer, you will have to bring a lawsuit and request the court to order payment of your damages and a refund of these amounts. To obtain these remedies, you can work with a consumer protection lawyer to bring a private legal action, although some cases require the New Jersey Attorney General’s involvement.
Which Situations are Covered by the New Jersey Consumer Fraud Act?
The NJ Act is one of the most comprehensive consumer fraud protection laws in the nation. Section 56:8-2 of the NJ Act defines which situations and actions are prohibited. In general, merchants, salespeople, contractors, and other businesses are prohibited from:
- acting in an unconscionable, deceptive, fraudulent, or false way while selling or advertising merchandise or real estate, and
- knowingly concealing, omitting, or suppressing material facts about merchandise or real estate so a consumer will rely on the concealment, omission, or suppression of the information and act in a certain way.
These actions and inactions violate the NJ Act regardless of whether the consumer is actually harmed, misled, or deceived. The NJ Act also addresses specific circumstances in greater detail including fraudulent activities in these areas:
- A person pretending to be associated with a government agency,
- Automobile purchase and repair contracts,
- Real estate contracts,
- Timeshare arrangements,
- Situations where an item or service is not sold as advertised,
- Prize notifications that require certain acts or payments to redeem the prize,
- False representations that a business is a charitable or nonprofit organization or provides benefits to handicapped people,
- Telemarketers that violate Do Not Call restrictions,
- Home improvement contractors,
- Identity theft (in data breach and personal information disclosure situations),
- Vehicle warranties,
- Internet dating safety, and
- Other specialized situations.
Possible Remedies For New Jersey Consumer Fraud Act Violations
The NJ Consumer Fraud Act provides strong protection and valuable remedies for consumers. Deceptive sales practices can occur between merchants and individuals or in businesses-to-business transactions when one of the businesses is considered a consumer.
You can bring a private legal action to enforce the provisions of the Act when a person or business violates the Act. The violator may be required to pay:
- A refund of any amount of money obtained through their unlawful activities,
- Three times the amount of your related damages – this remedy is known as treble damages and serves as a form of punishment, and
- Your attorney’s fees and costs.
Depending on your circumstances, you also may have rights under several federal laws. If so, you are not limited to filing legal action under the NJ Act. You may pursue remedies under other relevant federal laws such as the Fair Credit Reporting Act and Fair Debt Collection Practices Act in addition to the NJ Act.
Schlanger Law Group Proudly Serves New Jersey Consumers
The consumer protection attorneys at Schlanger Law Group have extensive experience enforcing the New Jersey Consumer Fraud Act and federal laws that protect innocent people in NJ and nationwide. From our offices in Westwood, New Jersey we fight to recover our clients’ hard-earned money and stop businesses that engage in fraudulent behavior.