Gift cards are a perennial favorite for holiday shoppers. They’re easy to wrap, universally appreciated, and always the right size. But as gift-giving season approaches, it’s important to remember that gift cards are also a common target for scams. In 2024, Governor Phil Murphy signed into law new requirements governing the sale and display of physical gift cards in New Jersey, aiming to combat the growing threat of gift card fraud. The legislation, P.L.2024, c.39 (S3587), places new obligations on merchants and manufacturers, including prominent consumer fraud notices and specific display protocols. The law applies to both in-person and online sales of physical gift cards. The law took effect October 1, 2025, but the state’s Division of Consumer Affairs has agreed to delay enforcement until February 1, 2026.
The law defines a “retail mercantile establishment” as any place where merchandise is offered for retail sale to the public. The gift card requirements apply to tangible devices with prepaid value issued in exchange for payment that promise the bearer merchandise up to the value of the card.
Key Requirements
One key component of the new legislation is the required Fraud Warning Notice. Retailers in New Jersey must now display a warning notice at the point of sale to inform consumers about the risks of gift card scams. The state requires retailers to display its form notice.
This notice must be posted and maintained at or near any physical location where gift cards are displayed or sold, in clear and conspicuous typeface. For online sales, it must also be provided to any consumer who purchases a physical gift card online by displaying it on the webpage where the gift card is offered for sale or before the sale is finalized.
Under the law, retailers may not display or sell a gift card unless:
- The card, or its packaging, prominently displays a tampering warning such as “Do not sell or purchase if the gift card or its packaging has been broken or indicates tampering,” or substantially similar language;
- If in packaging, the gift card is sealed so it cannot be easily opened, removed, or replaced without clear signs of tampering; and
- All visible sensitive card information (card number, CVV, PIN, etc.) is fully concealed or covered prior to sale.
The law exempts certain cards from the packaging and concealment rules, including chip-enabled, numberless cards that must be activated by the consumer after online registration and cards sold exclusively for use at one retailer and secured so only employees can access them.
In addition, every retail mercantile establishment that sells and displays gift cards in New Jersey must train employees on how to identify and respond to gift card fraud in accordance with guidelines issued by the Division of Consumer Affairs.
Violations of the display/packaging requirements or training requirements are subject to a civil penalty of $1,000, enforceable by the Director of the Division of Consumer Affairs. However,
violations are not considered “unlawful practices” under the broader New Jersey Consumer Fraud Act, so they do not trigger a private rights of action.
Takeaways
Given the sustained rise in gift card scams targeting consumers nationwide, New Jersey’s law underscores a growing policy trend to involve retailers more directly in fraud prevention. To prepare, retailers should begin by updating signage in stores and online platforms to ensure that the required Consumer Fraud Notice is clearly visible at all gift card display and sales locations and at every point of online sale, using the official language provided by the Division of Consumer Affairs. It’s also important to review all gift card packaging and display practices, making sure cards are sealed securely in tamper-evident packaging, warning labels about tampering are visible, and that all sensitive card details are fully concealed prior to sale. Retailers should also develop or update employee training to equip all staff involved in the sale or handling of gift cards with the knowledge to detect, prevent, and respond to potential fraud. Reviewing gift card offerings and sales protocols now will position retailers for compliance well ahead of the February 2026 enforcement deadline.