On March 27, 2018, the New Jersey Attorney General, Gurbir S. Grewal, announced the appointment of Paul R. Rodriguez to be the new Director of the New Jersey Division of Consumer Affairs. Mr. Rodriguez, a New Jersey native, previously served as Acting Council for New York City Mayor, Bill de Blasio, and a member of his senior management team. Before that, he was an associate at Simpson, Thatcher & Bartlett, LLP in New York City. He is a New Jersey native and a Yale Law graduate.
What makes this appointment interesting is the representation in the Attorney General’s announcement that the appointment “highlights the Administration’s efforts to fill the void left by the Trump Administration’s pullback of the Consumer Financial Services Bureau (CFPB), fulfilling one of Governor Murphy’s promises to create a ‘state-level CFPB’ in New Jersey.”
The New Jersey Division of Consumer Affairs is responsible, among other things, for enforcing the provisions of the New Jersey Consumer Fraud Act (CFA). The CFA prohibits unconscionable commercial practices, deceptions, fraud, false pretenses, false promises, misrepresentations, or the knowing concealment, suppression, or omission of material facts in connection with “the sale or advertisement of any merchandise or real estate,” and ‘merchandise” has been broadly interpreted by New Jersey courts as encompassing at least some credit products. It is also one of the strongest such statutes in the nation, since it provides for treble damages and is essentially a strict liability statute, meaning that it does not matter whether or not the consumer actually relied on the false, deceptive or misleading representations.
More importantly, perhaps, section 1042 of the Dodd-Frank Act gives state Attorneys General explicit authority, after giving notice to the CFPB and the financial institution target’s prudential regulator, if any, to bring a civil action to enforce provisions of Title X of Dodd-Frank, i.e., the Consumer Financial Protection Act (CFPA), or any regulations adopted under the authority of the CFPA, and to secure remedies provided under the CFPA. The Attorney General’s reference in his press release to a “state-level CFPB” appears to reflect an intention on his part for the Division of Consumer Affairs to aggressively make use of this expansive authority.