Arizona Real Estate Consumer Fraud Protection

Instructor: Kyle Aken

Kyle is a journalist and marketer that has taught writing to a number of different children and adults after graduating from college with a degree in Journalism. He has a passion for not just the written word, but for finding the universal truths of the world.

One powerful legal protection for consumers is the Arizona Consumer Fraud Act. Sometimes called a 'deceptive practices' act, this statute requires sellers and their agents to engage in truthful advertising and honest negotiations. Learn about this act and how it can help consumers harmed by real estate fraud.

Arizona Real Estate Consumer Fraud Protection

Real estate transactions in Arizona are covered by the Consumer Fraud Act (the 'Act'). Codified under the Arizona Revised Statues Title 44, Chapter 10, Article 7, Sections 44-1521 to 1534, this statute provides broad protection for consumers against any deception, unfair act or practice, false statement, false pretense, false promise, or misrepresentation made by a seller or advertiser of merchandise. Complaints can be filed with the Arizona Attorney General (see or through a private attorney as a private cause of action (see In other words, the Act supports public complaints and private causes of action.

The Act sets out its own definitions of terms used. These are broadly defined to provide as much protection as possible to consumers. The definition of 'sale' specifically includes real estate transactions (see A.R.S. § 44-1521(7)) and the definition of 'merchandise' names real estate (see A.R.S. § 44-1521(5)).

Four elements are required in order to bring a suit/cause of action under the Act, including:

1. The seller/defendant used deception, a deceptive act or practice, fraud, false pretense, made a false promise or misrepresentation (including concealing, suppressing, or omitting a material fact) in connection with the sale or advertisement (ad) of merchandise.

2. The seller/defendant intended that others rely upon the actions in #1.

3. The consumer/plaintiff suffered damages as a result of the reliance on the unlawful action(s).

4. The damages were incurred by the consumer/plaintiff.

One of the hardest aspects to determine is whether an ad or sales pitch is showing 'mere puffery' or instead includes a true misrepresentation or fraud. This is important because sellers and their agents are allowed some leeway to boast about their property. There is a difference between saying 'The windows are top of the line and stunning' versus 'The windows have never leaked and were replaced last year because I wanted new windows.' The second sentence, if false, could support a claim if water damage is found or windows start leaking. The standard to use for proof of deceptive language is 'if the least sophisticated reader would be misled', so sellers do need to be careful with representations.

The Act is a powerful basis for a private cause of action because the standard of evidence for consumer fraud is less stringent than with a common law fraud claim. Consumer fraud needs to be shown by a preponderance of the evidence as set out under the Act. That standard means that more than 50% of the evidence must be in the plaintiff's favor. In contrast, common law fraud requires proof with clear and convincing evidence, which requires a high probability that the claim is true.

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