New Jersey Attorney General Gurbir Grewal announced updates on the Division of Consumer Affairs’ actions to stop price gouging. As of this week:
- The Division has issued 92 subpoenas to retailers and online market places reported by consumers for allegedly engaging in unfair price increases.
- Approximately 756 cease-and-desist letters have been sent, warning retailers about the penalties for violating New Jersey’s price-gouging law, and the Consumer Fraud Act’s protections from gross and unreasonable inflation of the price of any product during a state of emergency.
The Division has logged a total of 4,245 complaints related to the COVID-19 emergency against 2,358 locations. Nearly 90 percent of the complaints allege unlawful price hikes on essential items like food, bottled water, cleaning products, and personal protective equipment such as masks, disinfectants and sanitizers.
Examples of alleged price hikes that consumers have reported to the Division include:
- a convenience store allegedly charging $4.50 for a quart of milk
- a wholesale store allegedly selling a case of paper towels for $65, almost double the previous $35 price
- a supermarket allegedly raising the price of bacon from $4 to $9.99—an increase of over 50%
- a medical supply store allegedly selling a 2.4-once bottle of hand sanitizer for $13.42
- a convenience store allegedly charging $30 for a single face mask
- a dollar store allegedly charging $3.99 for a package of gloves that used to cost $1.49
- a gas station allegedly selling purified water that normally costs $3 for $14 a pack
- a pharmacy allegedly charging $10 for small plastic containers of sanitizing wipes, which were previously sold for $3.99
- a deli allegedly selling a dozen eggs for $5.99
In addition to price gouging, the Division is looking into complaints from consumers alleging unlawful refund practices as a result of closures related to the COVID-19 health emergency. To date, the Division’s overall complaints include 202 reports of health clubs, hotels, ticket agents and other businesses allegedly refusing to issue refunds after they closed or suspended services as a result of the COVID-19 pandemic.
New Jersey’s price-gouging law, which took effect on March 9 upon Governor Murphy’s declaration of a state of emergency, prohibits excessive price increases during a declared state of emergency and for 30 days after its termination. A price increase is considered excessive if the new price is more than 10 percent higher than the price charged during the normal course of business prior to the state of emergency, and the increased price is not attributable to additional costs imposed by the seller’s supplier or additional costs of providing the product or service during the state of emergency.
Price-gouging and other consumer fraud violations are punishable by civil penalties of up to $10,000 for the first violation and $20,000 for the second and subsequent violations. Violators may also be required to pay consumer restitution, attorney’s fees, and investigative fees, and will be subject to injunctive relief. Each sale of merchandise is considered a separate violation.
Consumers who suspect consumer fraud, violations, or believe that businesses have unfairly increased their prices in response to COVID-19, are encouraged to file complaints online to report specific details investigators can follow up on. Photographs of items being sold, receipts and pricing can now be uploaded to our new price gouging complaint form.
Photo by Jacques Bopp on Unsplash