ASSEMBLY CONSUMER AFFAIRS COMMITTEE

STATEMENT TO

ASSEMBLY, No. 3986

STATE OF NEW JERSEY

DATED:  MARCH 19, 2026

      The Assembly Consumer Affairs Committee reports favorably Assembly Bill No. 3986.

      As reported by the committee, this bill requires a towing company to accept electronic authorization for a towed vehicle or its contents to be released to a third party.

      This bill supplements the “Predatory Towing Prevention Act,” P.L.2007, c.193, to require a towing company registered with the Division of Consumer Affairs to accept electronically transmitted written authorization from a person whose vehicle has been towed to permit the release of the vehicle, or property within the vehicle, to a third party.  The bill defines a “third party” as an insurance company, a collision repair company, or any other person the owner or operator of the towed vehicle designates.  The bill requires the Director of the Division of Consumer Affairs to issue or amend guidelines to implement the provisions of the bill, ensuring the legal transfer of property.

      A violation of the “Predatory Towing Prevention Act” is an unlawful practice under the consumer fraud act, P.L.1960, c.39, which is punishable by a monetary penalty of not more than $10,000 for a first offense and not more than $20,000 for any subsequent offense.  In addition, a violation can result in cease and desist orders issued by the Attorney General, the assessment of punitive damages, and the awarding of treble damages and costs to the injured party. 

      State law currently does not prohibit a person other than the owner or operator of a towed vehicle from retrieving a vehicle from a towing company.  However, towing companies often require the owner or operator of a towed vehicle to appear in person for the release of the vehicle, even when the vehicle is declared a total loss by the insurer or is being transferred to a collision repair facility. 

      This bill was prefiled for introduction in the 2026-2027 session pending technical review.  As reported, the bill includes the changes required by technical review, which has been performed.