New Jersey’s Consumer Fraud Act (CFA) is considered one of the toughest in the country.  The CFA applies to the sale or advertisement of any merchandise or real estate.  The term merchandise is defined to include objects, goods, commodities, services or “anything offered directly or indirectly to the public for sale.”

At various times, however, the courts in this state have determined that the CFA does not apply to transactions that are complex in nature.  Thus, it has been determined that the CFA will not apply to sophisticated investment plans between financial advisors and investors who were physicians or a tax shelter arrangement where the investors are a business entity and its owners. 

The general basis for these rulings is grounded upon the recognition that the CFA should apply to products or services that are sold to the general public and where the transaction is not terribly complex.  These rulings also recognize the need to place reasonable restraints on the applicant of the CFA in the marketplace