Attorney General Announces New Jersey's "Statewide Sandy Fraud Working Group" to Coordinate Prosecution, Investigation, and Data-Gathering of Criminal and Civil Fraud Related to Disaster Recovery
TRENTON – Attorney General Jeffrey S. Chiesa today announced the creation of New Jersey's Statewide Sandy Fraud Working Group to serve as New Jersey's clearinghouse for investigations and prosecution of criminal and civil fraud related to Superstorm Sandy and the disaster recovery process.
New Jersey's Statewide Sandy Fraud Working Group consists of representatives from the State Division of Criminal Justice, State Division of Consumer Affairs, State Office of the Insurance Fraud Prosecutor, New Jersey State Police, and the Atlantic, Middlesex, Monmouth, and Ocean County Prosecutor's Offices; and is co-coordinated by Division of Criminal Justice Director Elie Honig and State Division of Consumer Affairs Acting Director Eric T. Kanefsky. The working group coordinates all investigative and enforcement efforts at the State, county, and local levels to ensure all cases are referred and prosecuted as efficiently and effectively as possible.
"Though most New Jerseyans responded to Superstorm Sandy with resilience and generosity, some individuals unfortunately are motivated by the desire to take advantage of the misfortune of others. Such abuse will not be tolerated," Attorney General Chiesa said. "We have formed the Statewide Sandy Fraud Working Group to coordinate the efforts of the primary law enforcement and investigative agencies, criminal and civil, state and local, with a stake in this fight. Victims or witnesses of fraud should contact the working group directly with tips and complaints. We will ensure that all information is acted on by the appropriate agency, that all necessary information is shared across jurisdictional lines, and that all appropriate charges are brought."
Victims or witnesses of fraud committed in the aftermath of Sandy, including but not limited to home repair fraud, insurance fraud, and fraudulent charitable solicitations, should contact New Jersey's Statewide Sandy Fraud Working Group at 855-SANDY39 (855-726-3939) or www.StopSandyFraud.org.
Attorney General Chiesa noted that the Statewide Sandy Fraud Working Group will coordinate with the State Comptroller's Office, which today launched a Sandy Transparency Website, allowing the public to track state contracts and expenditures involving federal Sandy-related funding.
"We have formed this Working Group to make sure that all citizen complaints relating to Superstorm Sandy are acted on promptly and efficiently," said Elie Honig, Director of the New Jersey Division of Criminal Justice. "We will relentlessly pursue any instance of Sandy-related fraud, and we will not hesitate to bring criminal charges where appropriate."
Today's announcement coincides with National Consumer Protection Week, which runs this year from March 3 through March 9. The State Division of Consumer Affairs noted that consumer complaints related to Sandy – 2,164 in only two months – were the top complaint category in 2012. Last year's second-highest complaint category was "Home Improvements," which generated 1,528 consumer complaints during the entire 12 months. Attorney General Chiesa noted that home improvement-related complaints are expected to increase throughout the long post-Sandy recovery period.
"The Division of Consumer Affairs prepared for a surge of fraud-related complaints in the days before Sandy made landfall. We mobilized our investigators immediately after the storm struck the Jersey Shore, and took tough enforcement action against businesses and others accused of seeking to illegally profit from the storm," Eric T. Kanefsky, Acting Director of the New Jersey Division of Consumer Affairs, said. "As part of the Statewide Sandy Fraud Working Group, we continue these efforts in collaboration with our partners at the state and county levels for the protection of all New Jerseyans."
During the next few weeks, the Statewide Sandy Fraud Working Group will begin a public outreach campaign including public service announcements, billboards and transit ads, advising any fraud victims or witnesses to contact the Working Group with tips or complaints.
Recent Fraud Protection Actions
Examples of some actions already taken by the Attorney General's Office to protect consumers in the wake of Superstorm Sandy include:
- Price gouging investigations and lawsuits: The Attorney General has filed lawsuits against a total of 24 hotels and gas stations accused of violating New Jersey's price gouging law by increasing their prices excessively during the state of emergency. (See press releases from November 9, November 28, and December 19).
- Communication in the field with home improvement contractors: The Division of Consumer Affairs has assigned investigators to scour the hardest-hit areas of Atlantic, Monmouth, and Ocean counties, and speak directly with home improvement contractors working to rebuild homes in those areas. The investigative team also attends home shows in order to meet and interact with contractors. To date, the team has had direct contact with a total of 668 contractors. The investigators remind the contractors of the need to register with the Division of Consumer Affairs and comply with the Consumer Fraud Act and all other applicable laws and regulations. Since Sandy, the Division has received registration applications from 3,440 home improvement contractors, an 89 percent increase over the same period last year. Any contractors who fail to register will face notices of violation and civil penalties.
- Protecting against an allegedly fraudulent "Superstorm Sandy Reconstruction Summit." The Attorney General filed suit successfully blocking this event, alleging that the organizer falsely implied that he and his summit were affiliated or endorsed by federal, state, or local government agencies, and that he engaged in misleading advertising. As noted in the lawsuit, the organizer's background includes a personal bankruptcy filing that was opposed by the U.S. Bankruptcy Trustee due to alleged fraud, and approximately 20 outstanding judgments, many stemming from supposed post-disaster "summits" he held in other states.