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New Jersey Consumer Fraud Act

When you are engaging in any kind of business transaction involving the sale of goods or property, or the leasing of commercial or residential real estate, the New Jersey Consumer Fraud Act provides protections against deceptive, unfair, fraudulent, and unconscionable business practices.

New Jersey Consumer Fraud Act

Connected to the sale or advertisement of goods, services or real estate to the general public, consumer fraud is any conduct that is:

  • Unconscionable commercial practice,
  • Deception or fraud,
  • False pretense,
  • False promise or misrepresentation, or
  • Knowing concealment, suppression or omission of any material fact with the intent that others rely upon such concealment, suppression, or omission.

Sales include not only traditional transactions but also the renting of commercial and residential properties or even cars, boats, and other property. New Jersey’s CFA, in fact, makes it illegal to even attempt to offer a good, service, real estate, or rental using false or misleading language.

CFA permits any person, whether an individual or business, to file a CFA claim if that person established he or she has an “ascertainable loss” related to the act of consumer fraud. An ascertainable loss is the type of damage that is quantifiable or measurable.


Consumer fraud may be committed by:

  • Affirmative Misrepresentation – an untrue statement irrespective of whether the person knew the statement was untrue.
  • Knowing Omission – intentionally omits or failing to disclose a material fact, which is important to the transaction.
  • Violations – regarding specific-situation statute or administrative regulations associated with the CFA.

Ascertainable loss is the final component. In order to bring an action against a proprietor or other business agent, the consumer must show some “ascertainable loss”. In other words, the consumer must show that the suffered some damages as a result of the fraud or violation. Losses are generally understood to be either property or money.


CFA severely punishes the wrongdoer by permitting legal or equitable relief and mandating the award of:

  • Three times the damages sustained by the plaintiff, as well as
  • Attorney’s fees and costs

The NJ Consumer Fraud Act does not allow parties to bring actions for either emotional distress, inconvenience, or other “noneconomic” damages. Damages are calculated in monetary loss only and assigned a 3x punitive award.


A New Jersey commercial litigation attorney offers examples of CFA’s protection:

  • Sale, lease, service and/or repair of:
  • Motor vehicles
  • Watercrafts
  • Appliances
  • Residential sale or lease
  • Home construction or improvements

Who can be held liable under the NJ Consumer Fraud Act?

Consumer Fraud Act - Commercial Litigation Attorney Parsippany, NJTechnically, “persons” may be held liable under the NJ Consumer Fraud Act. However, the CFA has a very expansive definition of persons. Generally, the employees and executives of limited liability companies (LLCs) enjoy some protection from criminal actions. However, the CFA essentially allows the State Attorney General and law enforcement to hold those who operate on behalf of the business responsible for actions they conduct on behalf of the business. The CFA also allows the government to penalize the business itself.

In other words, in cases where a corporation, LLC, or other company participates in some action that is in direct violation of the CFA, the government can hold the company liable as a business entity and hold individual executives who participated in the violation individually liable. In order to hold management or executives liable under the CFA, it must be established that they enacted some policy in violation of the CFA.

Who can sue under the NJ Consumer Fraud Act?

Who Is a “Consumer”?

The New Jersey Consumer Fraud Act has no specific definition of consumer. However, legal precedent suggests that any individual or business who purchases a commodity or service for their own personal use (and not to resell) is covered under the act.

The Definition of “Persons” in Terms of Bringing an Action

The same expansive definition of “person” that allows both businesses and individuals acting at their behest responsible under the CFA allows businesses to bring actions against other businesses under the act. There are limitations, however. The NJ CFA is designed to protect the public from businesses.

Was the Business Acting as a Consumer?

While businesses can file lawsuits against other businesses under the CFA, the goods or services offered must be available to the general public. For instance, an auto parts wholesaler who sells to individual auto shops may not be liable under the CFA since those goods are not available to the general public. These cases are heard on a case-by-case basis. The principal question is: Was the business acting as a consumer or another seller?

This is known as the “character of the transaction” standard. In cases where a business is allowed to sue under the CFA, they are using the commodity or service for personal in-office use and the commodity or service is available to the general public at large. One example would be a stapler. So long as the business is not selling the stapler, they are allowed to sue if the stapler was fraudulently marketed.

Learned Professional Exemption

  • Doctors,
  • Lawyers,
  • Engineers,
  • Architects,
  • Accountants, and
  • Some other jobs.

The CFA does not apply to these professions so long as they are operating within their professional capacities.

Consult a skilled New Jersey commercial litigation attorney

The six-year statutory time limit to file a claim under the CFA accrues when the injured party suffers actual damage and discovers, or should have discovered, the facts essential to the CFA claim. If you suspect that you may have a CFA claim, don’t hesitate to contact us. Call Snellings Law LLC as soon as possible. Our New Jersey commercial litigation attorney will:

  • Evaluate and investigate your claim,
  • Determine the best strategy for you, and
  • Guide you through the complicated process.

We can evaluate your exposure under the NJ Consumer Fraud Act. We can ensure that you are compliant with the individual provisions of the act that are relevant to your area of business. If you are being sued under the CFA, we can help minimize the plaintiff’s damages.

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