State Officials Continue to Crackdown on Price Gouging in NJ

NEWARK – As New Jersey residents clamor to purchase food, hand sanitizer, and other products needed to stay safe and healthy during the coronavirus pandemic, Attorney General Gurbir S. Grewal and the New Jersey Division of Consumer Affairs (“the Division”) today announced more than 200 actions taken this week to stop unscrupulous retailers from jacking up prices on those essential items.

Over the past seven days, the Division has sent 217 cease and desist letters to merchants statewide and served an additional three subpoenas seeking information regarding alleged price gouging.

To date, the Division has issued 731 cease-and-desist letters and approximately 92 subpoenas to retailers from all regions of the state warning that New Jersey’s Consumer Fraud Act (CFA) protects consumers from gross and unreasonable inflation of the price of any product during a state of emergency.

“Price gouging is against the law and intolerable at a time people are doing their best to stay safe during this pandemic,” said Attorney General Grewal.

“We want to reassure New Jersey residents that we remain committed to take action against opportunists attempting to profit off the demand for essential items.”

“We will aggressively enforce New Jersey's consumer protection laws during this state of emergency,” said Paul R. Rodríguez, Acting Director of the Division of Consumer Affairs.

“We encourage consumers to remain vigilant and report price gouging and other attempts to take advantage of consumers using our online complaint form, where you can submit photos and screenshots of suspect activity.”

The Division has logged a total of 3,623 complaints related to the COVID-19 emergency against about 2,100 business locations.

Approximately 90 percent of the complaints allege unfair price increases on personal protective equipment, sanitizers, disinfectants, food, bottled water and other items in demand by consumers concerned about keeping safe and having enough food and supplies.

The Division has issued cease-and-desist letters and subpoenas to retailers across the state suspected of significantly inflating prices of items, associated with the current concerns related to COVID-19.

Examples of price hikes reported to the Division as potential violations:

a convenience store allegedly charging $6 single roll of paper towels; a janitorial supply store allegedly charging $20 for a can of Lysol; a convenience store allegedly raised the price of 2-ounce pocket bottles of hand sanitizer to $4.99 from its $1 pre-emergency declaration price— an almost 500% increase; a grocery store allegedly charging $12 for a gallon of milk; a deli allegedly charging $10 for a gallon of water; a convenience store allegedly charging $60 for a small package of toilet paper; an dollar store allegedly charging $9.99 for a gallon of bleach; a gas station allegedly selling single-use masks for $25 each; and a supply store allegedly charging $36 for a gallon of hand sanitizer

The Division is also reviewing reports of businesses selling homemade hand sanitizers and items not meant for individual sale such as wipes and certain masks. Consumers are urged to beware of poorly labeled merchandise.

The Division is also investigating reports of companies and individuals claiming to offer COVID-19 home test kits for sale and falsely marketing products as effective to prevent the spread of COVID-19, or overstating the effectiveness of their products.

Consumers should be skeptical of sellers of such home test kits and products.

New Jersey’s price-gouging law, which took effect on March 9 after 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 just 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.