Gov. Protects NJ Consumers

Governor James E. McGreevey and First Assistant Attorney General Peter C. Harvey Tuesday announced the filings of a series cases covering a wide-range of alleged violations involving dozens of individuals and companies that have allegedly attempted to take advantage of New Jersey consumers.

The cases highlight the broad-based consumer protection efforts by the State pursued under Governor McGreevey’s leadership.

“We will not stand by while New Jerseyans are cheated and defrauded of their hard-earned money by unscrupulous businesses and individuals,” said McGreevey. “Whether it's big name investors, predatory lenders, or untrustworthy repair shops, we will take action whenever businesses break the law and harm New Jersey consumers.”

“We are working hard on all fronts and exploring whatever legal remedies are available to ensure that we are adequately protecting consumers from those who would attempt to swindle them out of their hard-earned money,” First Assistant Harvey said.

The cases the Governor announced Tuesday will be brought by the New Jersey Division of Consumer Affairs and cover a wide range of areas from securities fraud, elder fraud, and predatory lending. Last month, the Governor announced that the Administration was taking action against four major corporate defendants alleged to be responsible for more than $150 million in State pension losses.

Securities Fraud/Elder Fraud:

The Governor today announced three separate actions targeting dozens of individuals and companies that allegedly engaged in elaborate schemes to defraud elderly citizens of their hard-earned savings.

First, the State is taking action against twenty-eight individuals for allegedly carrying out a massive, multi-million dollar promissory note scheme that resulted in losses to investors of more than $11 million.

Second, the State is taking action against two Central New Jersey men and their company, Prime Money Management, for allegedly devising and carrying out a scheme that cheated investors, many of whom were elderly citizens, out of more than $1 million.

The third case involves U.S. Paytel for allegedly deceiving investors by representing to them that their investments were paying for membership interests in the defendants’ business venture and that the investors would be actively involved in the acquisition, management and sale of pay telephone routes, for profit when, in actuality the defendants were selling them unregistered securities.

Predatory Lending:

The Administration has made fighting predatory lending a priority and has taken groundbreaking action to end such practices. This includes filing suit against a Hudson County real estate appraiser who allegedly prepared and submitted misleading and fraudulent appraisals as part of an elaborate predatory lending and land-flipping scheme that cheated low-income, minority consumers.

New Jersey has also finalized its agreement with Household International, providing for more than $17 million in restitution to New Jersey consumers. The consent judgment was filed along with a two-count complaint against the company alleging violations of the State’s Consumer Fraud Act and Licensed Lenders Act. The filing to the agreement resolves allegations raised in the complaint.

General Consumer Fraud:

The Governor also announced other actions to protect New Jersey consumers, including suits against:

* The owner and manager of a Camden County used auto parts shop in connection with their alleged sales of faulty and defective used and/or rebuilt transmissions.

* A Monmouth County furniture store and its principal for allegedly accepting payments from consumers for furniture and failing to deliver the goods, as promised.

* A Southern New Jersey hotel that was allegedly misleading consumers through advertisements that falsely depicted the hotel’s facilities as clean and luxurious even though it was in a serious state of disrepair and had been fined more than $16,000 for fire code violations.

* A defunct Southern New Jersey health club and its principals for allegedly defrauding consumers by accepting their money for long-term gym memberships even though the club was on the verge of closing and ceasing operations. This is the first of several cases expected to be filed involving health clubs.

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Author: Press Release-Kevin Davitt