AG Platkin, Division of Consumer Affairs Announce 2024 Consumer Protection Enforcement Highlights

TRENTON – Attorney General Matthew J. Platkin and the Division of Consumer Affairs (“Division”) today announced highlights of various consumer protection initiatives carried out by the Division in 2024, including those aimed at putting a stop to unlawful business practices that impede consumers’ ability to make informed purchasing decisions, shutting down unscrupulous investment schemes putting New Jersey investors at risk, and halting unfair and deceptive conduct in industries that historically generate a high volume of consumer complaints in New Jersey each year.

The Division carried out these initiatives through a strategy of targeted crackdowns, taskforce sweeps, and undercover investigations executed by its Office of Consumer Protection, Office of Weights and Measures, and Bureau of Securities.

“The Division of Consumer Affairs is responsible for enforcing laws that touch virtually every facet of consumers’ lives, from shopping for groceries to investing in their financial future,” said Attorney General Platkin. “The work done by the Division last year demonstrates its ongoing commitment to promoting equity and fairness in New Jersey’s retail and financial markets and protecting those who use them from being cheated and deceived.”

“By working collaboratively and targeting enforcement efforts to maximize impact, the units within the Division of Consumer Affairs successfully tackled a significant number of consumer protection issues during 2024,” said Cari Fais, Director of the Division of Consumer Affairs. “Whether leading the charge on emerging consumer protection concerns or keeping a vigilant eye on New Jersey’s most complained-about industries, the Division is using the full force of its enforcement authority to safeguard consumers from fraud and abuse in the marketplace and hold violators accountable.”

Office of Consumer Protection

The Division’s Office of Consumer Protection (“OCP”) played a leading role in the Division’s 2024 consumer protection enforcement efforts. Below are some highlights of the work done in various industries under the regulatory authority of OCP.

• Home Improvement Contractors

Historically, grievances pertaining to home improvement contractors (“HICs”) have ranked high on the Division’s annual Top Ten list of consumer complaints.

Last year, OCP resolved 103 cases of alleged consumer protection violations by HICs through settlements and other final orders that assessed contractors a total of $2.60 million in civil penalties, consumer restitution, and other fees and costs.

The actions against the HICs are the result of investigations conducted by OCP’s Home Improvement Enforcement Unit that found contractors had engaged in conduct that violated the New Jersey Consumer Fraud Act (“CFA”), the Contractor Business Registration Act, and the Regulations Governing Home Improvement Practices. The alleged conduct included performing home improvements without being registered with the Division; failing to provide consumers with detailed, written contracts; accepting consumer payments and then failing to begin or complete the home improvements; performing the contracted-for home improvement work in a substandard manner, and then failing to make the necessary corrective repairs; and failing to include on invoices, contracts, and correspondence the toll-free telephone numbers provided by the Division for consumers making inquiries concerning contractors. Deputy attorneys general from the Division of Law’s Consumer Fraud Prosecution Section represented the State in the settlements.

• Motor Vehicle Sales/Advertising

Complaints involving motor vehicles also rank high on the list of complaints received by the Division each year, with a significant portion of them alleging consumer protection violations in the advertising and sale of new and used automobiles.

As part of its 2024 enforcement efforts, OCP’s Auto and Commercial Fraud units resolved investigations of 32 auto dealerships allegedly engaging in practices that violated the CFA, the Motor Vehicle Advertising Regulations, the Automotive Sales Practices Regulations, and the Used Car Lemon Law. The alleged violations include failing to list prior accidents, damage, and repairs made to vehicles; failing to honor the advertised price of a used car; charging excessive vehicle preparation fees that were not itemized or properly disclosed to the consumer; failing to provide a written warranty; and failing to disclose the full sale price of a motor vehicle.

Twenty-nine dealerships settled the allegations against them by agreeing to consent orders or notices of violation totaling $498,877.54 in civil penalties, consumer restitution, and investigative costs. Individual settlement amounts ranged from $500 to $80,000 per dealership.   Three dealerships were issued final orders of default imposing a combined $41,040.12 in penalties, restitution, and costs.  In addition to making the required monetary payments, under the terms of the orders, dealerships must refrain from engaging in any unfair or deceptive acts or practices, comply with all applicable state and federal laws, and resolve consumer complaints.

Deputy attorneys general from the Division of Law’s Consumer Fraud Prosecution Section represented the State in the settlements.

Under the CFA, New Jersey’s Public Movers and Warehousemen Licensing Act, and related regulations, companies transporting goods in moves that begin and end in New Jersey must be licensed by the Division. To better protect consumers from the risks associated with rogue movers operating outside the Division’s regulatory authority, in June 2024, OCP’s Registered Business Enforcement Unit launched “Operation Safe Move,” an undercover enforcement initiative targeting unlicensed moving companies.

As part of the three-day undercover initiative, movers advertising on various websites were booked for a “job” transporting personal possessions of OCP investigators posing as consumers. When the movers hired by the OCP investigators showed up at the designated location of the “move,” they were met by a team of investigators seeking verification of licensure.

As a result of Operation Safe Move 2024, 23 moving companies were issued notices of violation (“NOVs”) for operating without being licensed by the Division. The NOVs assessed $5,000 civil penalties against 20 of the companies, while one company was assessed a $10,000 civil penalty as a second-time violator and two companies were assessed $20,000 in civil penalties as repeat offenders.

• Unlawful Business Practices

Last year, the Division reached settlements with two out-of-state firearms retailers resolving allegations that they violated the CFA and the Rules Concerning Hazardous Products by shipping large capacity magazines into New Jersey without warning purchasers that the products are illegal to knowingly possess in this state. The allegations stem from undercover investigations during which investigators within OCP’s Cyber Fraud Unit used the retailers’ websites to purchase numerous prohibited firearm magazines and then had them shipped to undercover addresses in New Jersey. To resolve the allegations, Indiana-based firearms dealer Element Armament agreed to pay $17,705 – which includes a $12,000 civil penalty – and make significant changes to its business practices to comply with New Jersey law. In the second settlement, Dick’s Sporting Goods Inc. agreed to pay $46,000, which includes a $38,919 civil penalty. Deputy attorneys general with the Division’s Consumer Fraud Prosecution Section represented the State in the settlements.

Also last year, OCP amped up enforcement of a New Jersey law prohibiting the sale of flavored vaping products, products known to lure in children and teens with enticing flavors and bright packaging. Through undercover buys and in-store inspections, OCP investigators identified smoke shops, convenience stores, and gift and novelty retailers across the state offering and selling vapor products characterized by candy, fruit, chocolate, and other flavors. As a result of the crackdown, 19 retailers were issued NOVs and assessed a total $85,000 in civil penalties for violating the CFA by selling banned products. OCP continued the flavored vapor enforcement efforts by sending warning letters in December to nearly 11,000 New Jersey businesses licensed to sell tobacco and vaping products, reminding them that offering or selling banned products is punishable by up to $10,000 for the first violation and $20,000 for each subsequent violation.

Office of Weights & Measures

The Division’s Office of Weights and Measures (“OWM”) is responsible for ensuring that all commercial weighing and measuring devices in New Jersey – from grocery scales and price scanners to coin counting machines and home heating oil delivery meters – are tested and inspected for accuracy and meet federal guidelines for specifications and tolerances. Additionally, OWM enforces New Jersey’ labeling and pricing laws by conducting tens of thousands of random inspections of packaged products each year.

In 2024, OWM’s inspection of more than 275,000 individual commodities statewide – from baked goods and pasta to cereal and shampoo – resulted in 3,438 summonses issued to businesses for allegedly selling products that weighed less than what was stated on the label, failing to include required information on product labels, or otherwise violating New Jersey Weights and Measures laws and regulations. Inspections of more than 10,000 packaged meat products resulted in 112 enforcement actions for violations of regulations pertaining to the retail sale of meat in New Jersey.

Additionally, OWM issued 1,344 notices of violation to stores for failure to comply with a New Jersey law requiring retailers to display the price of food, coffee, cleaning products, and other commodities using a standard unit of measure set by regulation. These unit price rules allow consumers to compare prices to determine the best value.

A highlight of those efforts was a three-month investigation by OWM’s Unit Pricing Section that led to a record $1.64 million settlement with Walmart to resolve allegations of widespread unit pricing violations at the chain’s 64 New Jersey locations. The settlement, which included a $1.61 million civil penalty, is the largest ever obtained by OWM. Deputy attorneys general from the Division of Law’s Consumer Fraud Prosecution Section represented the State in the Walmart settlement.

Bureau of Securities

The Division’s Bureau of Securities (“Bureau”) is charged with protecting investors from investment fraud and regulating the securities industry in New Jersey. In addition to bringing investigative and enforcement actions against firms or individuals who violate the New Jersey Uniform Securities Law and Regulations, the Bureau registers securities offered or sold in New Jersey and oversees the firms and individuals selling securities or providing investment advice to New Jersey residents.

In 2024, the Bureau issued 20 enforcement orders and assessed more than $1.39 million in civil penalties against firms and individuals. These enforcement actions included cease and desist orders halting unlawful or fraudulent conduct in the offer and sale of securities in New Jersey, consent orders resolving allegations against financial professionals and firms, and summary orders revoking or denying registrations of investment professionals.

The consent orders reached last year resolved cases that included a Philadelphia-based investment adviser firm that did business in New Jersey without being registered; a Florida firm that offered and sold unregistered securities in connection with a cryptocurrency interest-earning program; and a Florida man who misled elderly New Jersey investors in the offer and sale of unregistered securities.

The summary orders issued last year included an order revoking the registrations of a New Jersey broker-dealer agent/investment adviser representative who sold elderly clients unsuitable, high-risk investments that benefitted him financially, but were not in the clients’ best interest and resulted in financial losses to them.

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