COVID-19 Update for Consumers and Businesses: Combatting Price Gouging and Consumer Fraud
NJ’s Price-Gouging Law Took Effect on March 9; Send Complaints to DCA

NEWARK – As New Jersey continues to take measures to address the COVID-19 outbreak, Attorney General Gurbir S. Grewal and the Division of Consumer Affairs (Division) today warned residents to beware of price gouging and consumer fraud during the State of Emergency declared to contain the spread of COVID-19.

New Jersey’s price gouging law prohibits excessive price increases during a declared state of emergency and for 30 days after its termination. With Executive Order No. 103, Governor Phil Murphy declared that New Jersey entered a State of Emergency, effective March 9, 2020.

“Businesses seeking to take advantage of vulnerable consumers during a State of Emergency will face serious consequences,” said Attorney General Grewal. “The state’s price-gouging laws will be strictly enforced to protect consumers trying to stay safe and take measures to protect themselves and their loved ones from the spread of the disease.”

“We are asking residents to immediately report anyone seeking to illegally profit from public concern in response to this public health emergency,” said Paul R. Rodríguez, Acting Director of the Division of Consumer Affairs. “The Division is actively investigating reports of price gouging, and stands ready to protect consumers by enforcing the law.”

To date, the Division has received approximately 160 consumer complaints alleging price gouging or other unfair practices related to the public’s concern about COVID-19. More than half of the complaints on file with the Division were reported after the State of Emergency was declared. Investigators are inspecting stores and other businesses in response to consumer complaints. The state of emergency places restrictions on price increases on all consumer products and services. So far, the Division has received the most complaints about price increases on surgical masks, cleaning products, such as hand sanitizers, disinfectant sprays and wipes, as well as food and bottled water.

The Division is also reviewing reports of businesses selling dangerous homemade health and/or sanitation products, and urges consumers to beware of poorly labeled merchandise. As part of that effort, the Division has announced an investigation into the business practices of a 7-Eleven in River Vale. That store is alleged to have diluted commercially available foaming sanitizer, repackaged the diluted product in aftermarket bottles, and sold the product to members of the public. This product is alleged to have caused chemical burns to a child. The Division is coordinating its investigation of the 7-Eleven with the Bergen County Prosecutor’s Office.

Consumers are also urged to beware of in-store or online advertisements for products that claim to cure or prevent COVID-19 or other offers and solicitations related to the disease.

Price-gouging violations are punishable by civil penalties of up to $10,000 for the first offense and $20,000 for the second and subsequent offenses. Violators may also be required to pay consumer restitution, attorney’s fees, investigative fees, and injunctive relief. Each individual sale of merchandise is considered a separate and distinct violation.

TIPS TO CONSUMERS CONCERNING PRICE GOUGING:

Excessive price increases are illegal during a State of Emergency.  An excessive price increase is any price that exceeds 10 percent of the price the product or service was sold during the normal course of business prior to the State of Emergency.

If you believe price gouging is occurring, contact the Division of Consumer Affairs at (973) 504-6240.  A special voicemail box has been set up to address COVID-19 related price gouging complaints and will be checked regularly, even if state offices are closed.  Please leave your name, contact information, nature of the complaint, and the name and location of the business.  Consumers should note the price of a good or service being sold, as well as the price prior to the declared State of Emergency, if known.
Consumers are also encouraged to file complaints online by visiting the Division’s website.