The Iowa House and Senate recently passed legislation to give consumers a private right of action for fraud claims. Previously Iowa was the only state in the nation that did not provide such a right to its citizens.
Consumer advocacy groups say there are too many exemptions under the bill, which is expected to be signed by Governor Culver, including services provided by insurance companies, banks, lawyers, cable TV providers, doctors, veterinarians and architects. But overall this is a positive step for protection of Iowa’s consumers.
The Iowa Attorney General is understandably pleased as it will now allow private lawyers to pursue consumer fraud claims and will help alleviate a backlog of these claims which were handled previously by the AG’s office.
Consumers may be awarded up to three times the amount of the actual damages plus an award of reasonably attorney’s fees if successful. This will undoubtedly put pressure on businesses accused of fraud claims to resolve their differences with consumers.