Reprinted with permission from Ethics in the Market Place: A Jewish Perspective, published by The Library of Jewish Law, 2000, where extensive notes supplement the text presented here.
Misrepresentation Tops the Theft List
Jewish law takes a very strict approach to misrepresentation and fraud in commerce. In the Tosefta (Bava Kama 7:8) we read: “There are seven types of thief. First and foremost among them is one who misrepresents.”
Maimonides writes: “It is forbidden to deceive people in buying and selling or to deceive them by creating a false impression…. If one knows that an article he is selling has a defect, he must inform the buyer about it. It is forbidden to deceive people even by words.” (Mishneh Torah, Laws of Sale 18:1)
The prohibition applies even where the purchaser suffers no economic loss as a result of the misrepresentation.
A number of prohibitions regarding commercial transactions have been established on the basis of the prohibition of misrepresentation:
Used Goods Should Look Used
Goods may not be dressed-up so as to mislead the customer to think they are better than they really are:
“One should not dress up… an animal or old vessels so that they appear new; but he may dress up new ones by polishing, ironing, or beautifying them all they require.” (Mishneh Torah, Laws of Sale 18:2)
It is permitted to remove waste from grain in order to make its appearance more pleasing, but it is forbidden to remove waste from the top and leave it at the bottom. (Mishneh Torah, Laws of Sale 18:4)
Deceptive Grade Mixtures Are Prohibited
It is forbidden to mix merchandise of higher quality with merchandise of lower quality and to sell the entire mixture as the former. If, however, the nature of the mixture is readily apparent, it is permitted, since there is no deception:
“If the taste of each of the wines can be distinguished, it is permissible to mix them anywhere, because everything which can be distinguished will be detected by the purchaser and it is therefore permissible.” (Mishneh Torah, Laws of Sale 18:5)