
Dan Brecher
Counsel
212-286-0747 dbrecher@sh-law.comFirm Insights
Author: Dan Brecher
Date: January 26, 2026

Counsel
212-286-0747 dbrecher@sh-law.com
In 2025, New York enacted one of the most consequential updates to its consumer protection framework in decades. The Fostering Affordability and Integrity through Reasonable Business Practices Act (FAIR Act) significantly expands the scope and strength of New York’s long-standing consumer protection statute, General Business Law § 349, and alters the compliance landscape for New York businesses.
While Section 349 prohibited “deceptive acts or practices,” it notably lacked explicit bans on unfair or abusive conduct. The FAIR Act closes that gap, aligning New York more closely with modern consumer protection regulations. This article addresses the changes under the FAIR Act, why they matter, and what businesses need to do going forward.
New York’s consumer protection law now covers unfair, deceptive, and abusive acts and practices, not just deceptive ones. This expansion brings the law more in line with the federal Consumer Financial Protection Act (CFPA), which also prohibits unfair, deceptive, or abusive acts and practices. The terms are defined as follows:
While Section 349 traditionally focused on consumer-oriented conduct, the amended statute clarifies that the Attorney General may bring actions to protect not only individual consumers, but also small businesses and nonprofit organizations harmed by unfair or abusive practices. Pursuant to the FAIR Act, “[a]n act or practice made unlawful by this section is actionable by the attorney general regardless of whether or not that act, or practice is consumer-oriented.”
The FAIR Act significantly strengthens the legal remedies available to both the Attorney General’s office and private individuals and small businesses. To start, the new law significantly increases the statutory damages for violations of Section §349 from $50 to $1,000. In addition to statutory damages, the law allows for the recovery of actual and punitive damages, as well as the recovery of attorney’s fees and costs by prevailing plaintiffs in private actions.
The FAIR Act also includes significant civil penalties for violations. Businesses found to have engaged in unfair, deceptive, or abusive practices can incur penalties of up to $5,000 per violation. For violations that are deemed knowing or willful, the penalties are enhanced, set at the greater of $15,000 or three times the amount of restitution for each violation.
States like New York are picking up some of the important enforcement work that the currently encaptured Consumer Finance Enforcement Bureau is walking away from. The fear is that without greater state involvement, the ongoing curtailment of the CFPB’s watchdog role will have a negative impact on minority communities that are presently at greater risk of financial predation.
For businesses operating in New York, the FAIR Act raises the stakes for compliance. Traditional disclosure-based compliance strategies may no longer be sufficient. A practice that is fully disclosed can still be challenged if it is deemed unfair or abusive in substance. Accordingly, companies should reassess:
Risk assessments should focus not only on whether practices are misleading, but also on whether they could be viewed as exploitative, coercive, or unduly harmful.
The FAIR Act represents a fundamental shift in New York consumer protection law. By expanding Section 349 to cover unfair and abusive practices, broadening who is protected, and enhancing enforcement tools, the Legislature has transformed a narrow statute into a powerful regulatory tool.
For New York businesses, the FAIR Act’s broad language may lead to an uptick in enforcement, private litigation, and legal uncertainty. Terms such as “unfair” and “abusive” are inherently flexible, and their precise contours will be defined through enforcement actions and court decisions. For compliance guidance, we encourage you to contact a member of Scarinci Hollenbeck’s Corporate Transactions & Business Group.
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