Every State has passed a Consumer Fraud Protection Act. These Acts are intended to allow consumers to have the ability to fight against companies who use fraudulent and deceptive business practices. That power comes from a provision in the law that permits the consumer to recover treble damages. This means triple damages. In addition, the consumer may also recover reasonable attorney’s fees and costs, if the consumer proves that an unlawful act was committed by a business.

The following list contains several examples that may unlawfully violate most of the Consumer Fraud Acts in the United States.

The use by any business of any "unconscionable commercial practice, deception, fraud, false pretense, false promise or misrepresentation" in connection with the sale or advertisement of any merchandise or real estate. Merchandise includes products or services. This provision applies to many type of businesses, including auto dealerships, mechanics, banks, finance companies, hotels, insurance companies, home improvement contractors, telephone companies, mortgage companies, auto supply companies and any other business from which a product or service was purchased;
Knowingly conceal, suppress or omit important facts about a product or service intending that the consumer rely on such deception or concealment.
Notifying someone that he or she won a prize and requiring him/her to do any act, purchase any other item or submit to a sales promotion effort;
Failure to provide an exact copy of a contract to the consumer;
A towing or auto storage company charging excessive or discriminatory rates;
Selling over-the-counter drugs, baby food, or infant formula beyond the expiration date;
Making a home solicitation of a senior citizen for a mortgage on
the home to pay for home improvements;
Used car dealer’s failing to disclose a known defect in the vehicle,
misrepresentation in the sale of the vehicle, failure to provide a
state required warranty, and/or failure to re-purchase a vehicle after
unsuccessfully attempting it repair it.
Advertising an item for sale without the store being able to honor
the sales quantity or price in an effort to "Bait and witch"
the consumer into purchasing or leasing a more expensive or profitable item.

The Act is very broad and covers most transaction sales and leases to an end user or a consumer. However, the Act does not apply to products or services purchased with the intent of re-sale. The Act also protects businesses (no matter how large or small) as well as individual consumers. The Act applies to product or services for use or consumption by an individual or business. If the business is found to be in violation of the consumer protection laws, the consumer may be entitled to recover treble damages (three times the damages or value) of actual loss, plus all reasonable fees and costs incurred. Even if the consumer cannot prove any loss, reasonable legal fees are still recoverable. This provision was intended to permit consumers to retain an attorney without having to pay large sums in legal fees for litigation. In fact, in many cases, attorney’s take these cases
on a contingency fee basis. This means that you may not have to pay the attorney to sue a company for a violation. The attorney will merely take a percentage of the recovery. Additionally, if you do pay the legal fees up front, you may get all or most of your money back, in addition to triple damages.

The selling of damaged cars is a significant problem in the automotive
industry. Typically, either the odometer will be rolled back or lowered
to reflect a substantially lower mileage than the car actually has, or
vehicle damages will be covered up so that a car that was once in substandard shape will appear to be in much better condition that it really is.

The law provides protection for consumers who purchase or lease products which cannot be fixed, do not work or cannot be fixed in a reasonable time period. Usually, the laws provide for three strikes rule; that is, if the vehicle has needed at least three repairs with the first few months of ownership, than a claim may be filed. Additionally, some sates require that the use, value or safety have been significantly affected. For example, a vehicle with hidden frame damage will be worth far less that a vehicle not involved in an accident or otherwise damaged.

Enacted in 1975, The Magnusson-Moss Warranty Act (15 U.S.C. § 2301 et seq.), is a federal law generally regarded as the starting point for most breach of warranty claims. This provides remedies for personal use of products when the products do not work or cannot be fixed in a reasonable time period. It also permits remedies for violations of any state law warranty. As an example, New Jersey requires used car dealers to provide warranties for most used cars under the New Jersey used car lemon law. Some used car lemon laws provide for fees while other state laws do not. However, the Magnusson Warranty Act does provide for
fees and costs. Thus a violation of the used car lemon law would create a cause of action under federal law.

Warranties can be either express, implied, or both. An express warranty can be created by contract or a writing (certified dealer warranty), or by the actions or statements of the salesman. An example would be if the dealer says that the car is in excellent condition and will not need repairs for at least the next 20,000 miles.

Implied warranties are created by law so as to protect consumers from products that do not work correctly. The law implies the promise or the obligation of the selling or the entity that warrantees the products to work as both parties expected.

According to NADA, U.S. motor vehicle sales accounted for nearly 20% of total retail sales last year. NADA estimates that dealers generate in excess of $20 billion in annual sales tax revenue from the sale of vehicles.

If you think your new or used cars have been damaged, you should take appropriate legal action against the dealer.

Unfair & Deceptive Acts and Practices

New Jersey Consumer Fraud Act, as well as the Laws in most states, cover acts which are considered to Unfair Deceptive Acts and Practices. The New Jersey Fraud Act provides wide ranging regulation applying to the sale and attempted sale of products and services. against many types of businesses including car dealerships, home improvement businesses, realtors, real estate agents, banks, mortgage and financial companies, supply dealers, stores, builders, manufacturers, distributors, dealers, stores, and many others.

Unfair Deceptive Acts and Practices violations include affirmative misrepresentations, any omission of a material fact, regulation violations and other types of deceptive conduct. An example of an affirmative misrepresentation is if, while negotiating a transaction for the sale of an automobile, the seller states that the vehicle had only 20,000 miles when it in fact had 50,000 miles. If the seller knew of the odometer was incorrect and failed to disclose it, knowing that the consumer relied on the odometer statement as being truthful, than it might be considered a material omission under unfair and deceptive practices laws.

The Consumer Fraud Acts also covers deceptive practices in advertising, regulations, automobile repair regulations, general advertising regulations, home improvement regulations, for sale sales in stores, and stores that advertise price cuts and other savings for store closings and going out of business sales. If a business violates one of these administrative code regulations, it is known as a perse violation of Consumer Fraud Act.

The 1968 Truth In Lending Act

The Truth In Lending Act is a 1968 Federal law that protects the consumer by requiring, among other things, complete disclosure such as the interest rate, number of payments, amount financed, amount paid to others, amount retained by sellers, name of the creditor and address of the creditor. The statute is contained in Title I of the Consumer Credit Protection Act, as amended (15 U.S.C. § 1601 et seq.). The specific regulations that implement the law are known as “Regulation Z”, and are codified at 12 CFR Part 226. The Truth In Lending Act is a strict liability statute. This means that the maker of the note has responsibility for any wrong doing regardless of their intent. The lender can violate the statute by mistake and continue to be liable for a violation of the Truth In Lending Act. Under some circumstances there is a good faith defense. Most states provide for statutory damages and mandatory attorney’s fees and costs. Certain jurisdictions have also ruled that lenders who violate the Truth In Lending Act may not be able to lawfully collect on their note, allowing
the consumer to keep the goods leased or purchased free of any liens.

For a look at an excerpt from the New Jersey Consumer Fraud Act, Click Here

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