NEWARK – Attorney General Jeffrey S. Chiesa and the New Jersey Division of Consumer Affairs today warned merchants that price gouging is prohibited during the states of emergency that have been declared in Atlantic, Cumberland, Monmouth, and Salem counties, and any others that may be declared.
Attorney General Chiesa reminded retailers that New Jersey’s price gouging statute, N.J.S.A. 56:8-107, et. seq., makes it illegal to set excessive price increases during a declared state of emergency or for 30 days after the termination of the state of emergency.
“During life-threatening emergencies, New Jerseyans should look out for each other – not seek to take advantage of each other,” Attorney General Chiesa said. “We will look closely at any and all complaints about alleged price gouging. Anyone found to have violated the law will face significant penalties.”
For the purposes of the statute, a “state of emergency” is defined as a natural or man-made disaster or emergency for which a state of emergency has been declared by the President of the United States, the Governor, or a municipal emergency management coordinator.
The statute deems price increases excessive if they are more than 10 percent higher than the price at which a good or service was sold in the usual course of business prior to the State of Emergency; or, if additional costs are imposed by suppliers or certain logistical concerns during the State of Emergency, the increase is more than 10 percent of the amount of markup from cost, compared with the markup ordinarily applied.
Violations of the price-gouging law are punishable by civil penalties of up to $10,000 for the first offense and $20,000 for the second and subsequent offenses. Each individual sale of merchandise is considered a separate and distinct event.
"Retailers should know we will conduct a thorough investigation, including an audit of the merchant’s receipts dating back to before the State of Emergency, to examine each and every complaint," Eric T. Kanefsky, Acting Director of the New Jersey Division of Consumer Affairs, said. "Anyone violating the law will find the penalties they face, far outweigh the profits of taking unfair advantage of their fellow New Jerseyans during a time of great need."
The Division of Consumer Affairs provides tips for consumers on “How To Avoid Disaster-Related Scams,” including information on price gouging and on the home-repair scams and charity scams that have been known to arise during times of emergency:
- In English at http://www.njconsumeraffairs.gov/disaster/floodtipsflyer_1.pdf
- And in Spanish at http://www.njconsumeraffairs.gov/disaster/floodtipsflyerSP_1.pdf
Last year, during and after the State of Emergency declared in the wake of Tropical Storm Irene, the Division of Consumer Affairs sent investigators out to all affected counties in order to provide information to consumers about price gouging, home repair scams, and charity scams; and to investigate and mediate consumer complaints related to the emergency
Consumers who believe they have been cheated or scammed by a business, or suspect any other form of consumer abuse, can file a complaint with the State Division of Consumer Affairs by visiting its website or by calling 1-800-242-5846 (toll free within New Jersey ) or 973-504-6200.