Bill Text: NY A00606 | 2013-2014 | General Assembly | Introduced
Bill Title: Requires debt collectors to send consumers a written notice of their rights under state law along with their initial debt collection correspondence; applies to consumer rather than commercial debts.
Spectrum: Partisan Bill (Democrat 29-0)
Status: (Engrossed - Dead) 2014-05-28 - REFERRED TO CONSUMER PROTECTION [A00606 Detail]
Download: New_York-2013-A00606-Introduced.html
S T A T E O F N E W Y O R K
________________________________________________________________________
606
2013-2014 Regular Sessions
I N A S S E M B L Y
(PREFILED)
January 9, 2013
___________
Introduced by M. of A. DINOWITZ, CLARK, ORTIZ, MILLMAN, ROBINSON,
RIVERA, GABRYSZAK, JAFFEE -- Multi-Sponsored by -- M. of A. AUBRY,
BRENNAN, COOK, CYMBROWITZ, ENGLEBRIGHT, FARRELL, GLICK, GOTTFRIED,
HOOPER, JACOBS, LIFTON, LUPARDO, MAGEE, MAGNARELLI, PAULIN, PERRY,
PRETLOW, SCARBOROUGH, WEISENBERG -- read once and referred to the
Committee on Consumer Affairs and Protection
AN ACT to amend the general business law and the financial services law,
in relation to debt collection notices
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
1 Section 1. The general business law is amended by adding a new
2 section 601-a to read as follows:
3 S 601-A. DEBT COLLECTION NOTICE TO CONSUMERS. 1. AS USED IN THIS
4 SECTION, THE FOLLOWING TERM SHALL HAVE THE FOLLOWING MEANING:
5 "DEBT COLLECTION AGENCY" SHALL MEAN A PERSON, FIRM OR CORPORATION
6 ENGAGED IN BUSINESS, THE PRINCIPAL PURPOSE OF WHICH IS TO REGULARLY
7 COLLECT OR ATTEMPT TO COLLECT DEBTS: (I) OWED OR DUE OR ASSERTED TO BE
8 OWED OR DUE TO ANOTHER; OR (II) OBTAINED BY, OR ASSIGNED TO, SUCH
9 PERSON, FIRM OR CORPORATION, THAT ARE IN DEFAULT WHEN OBTAINED OR
10 ACQUIRED BY SUCH PERSON, FIRM OR CORPORATION.
11 THE TERM DOES NOT INCLUDE: (I) ANY OFFICER OR EMPLOYEE OF A CREDITOR
12 WHILE, IN THE NAME OF THE CREDITOR, COLLECTING DEBTS FOR SUCH CREDITOR;
13 (II) ANY PERSON WHILE ACTING AS A DEBT COLLECTION AGENCY FOR ANOTHER
14 PERSON, BOTH OF WHOM ARE RELATED BY COMMON OWNERSHIP OR AFFILIATED BY
15 CORPORATE CONTROL, IF THE PERSON ACTING AS A DEBT COLLECTION AGENCY DOES
16 SO ONLY FOR PERSONS TO WHOM IT IS SO RELATED OR AFFILIATED AND IF THE
17 PRINCIPAL BUSINESS OF SUCH PERSON IS NOT THE COLLECTION OF DEBTS;
18 (III) ANY PERSON WHILE SERVING OR ATTEMPTING TO SERVE LEGAL PROCESS ON
19 ANY OTHER PERSON IN CONNECTION WITH THE JUDICIAL ENFORCEMENT OF ANY
20 DEBT;
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD02933-01-3
A. 606 2
1 (IV) ANY ATTORNEY-AT-LAW OR LAW FIRM COLLECTING A DEBT IN SUCH CAPACI-
2 TY ON BEHALF OF AND IN THE NAME OF A CLIENT THROUGH LEGAL ACTIVITIES
3 SUCH AS THE FILING AND PROSECUTION OF LAWSUITS TO REDUCE DEBTS TO JUDG-
4 MENTS, BUT NOT ANY ATTORNEY-AT-LAW OR LAW FIRM WHO REGULARLY ENGAGES IN
5 ACTIVITIES TRADITIONALLY ASSOCIATED WITH DEBT COLLECTION, INCLUDING BUT
6 NOT LIMITED TO, SENDING DEMAND LETTERS OR MAKING COLLECTION TELEPHONE
7 CALLS;
8 (V) ANY PERSON EMPLOYED BY A UTILITY REGULATED UNDER THE PROVISIONS OF
9 THE PUBLIC SERVICE LAW, ACTING FOR SUCH UTILITY;
10 (VI) ANY PERSON COLLECTING OR ATTEMPTING TO COLLECT ANY DEBT OWED OR
11 DUE OR ASSERTED TO BE OWED OR DUE ANOTHER TO THE EXTENT SUCH ACTIVITY;
12 (A) IS INCIDENTAL TO A BONA FIDE FIDUCIARY OBLIGATION OR A BONA FIDE
13 ESCROW AGREEMENT; (B) CONCERNS A DEBT WHICH WAS ORIGINATED BY SUCH
14 PERSON; OR (C) CONCERNS A DEBT WHICH WAS NOT IN DEFAULT AT THE TIME IT
15 WAS OBTAINED BY SUCH PERSON AS A SECURED PARTY IN A COMMERCIAL CREDIT
16 TRANSACTION INVOLVING THE CREDITOR;
17 (VII) ANY OFFICER OR EMPLOYEE OF THE UNITED STATES, ANY STATE THEREOF
18 OR ANY POLITICAL SUBDIVISION OF ANY STATE TO THE EXTENT THAT COLLECTING
19 OR ATTEMPTING TO COLLECT ANY DEBT OWED IS IN THE PERFORMANCE OF HIS OR
20 HER OFFICIAL DUTIES; OR
21 (VIII) ANY NON-PROFIT ORGANIZATION WHICH, AT THE REQUEST OF CONSUMERS,
22 PERFORMS BONA FIDE CONSUMER CREDIT COUNSELING AND ASSISTS CUSTOMERS IN
23 THE LIQUIDATION OF THEIR DEBTS BY RECEIVING PAYMENTS FROM SUCH CUSTOMERS
24 AND DISTRIBUTING SUCH AMOUNTS TO CREDITORS.
25 2. EACH AND EVERY DEBT COLLECTION AGENCY SHALL INCLUDE IN EACH INITIAL
26 CORRESPONDENCE ON A PAST DUE DEBT TO A DEBTOR A CLEAR AND CONSPICUOUS
27 WRITTEN STATEMENT, IN SUBSTANTIALLY THE FOLLOWING FORM, TO BE CLEARLY
28 AND CONSPICUOUSLY LABELED "CONSUMER RIGHTS":
29 CONSUMER RIGHTS
30 AS A CONSUMER WHO OWES OR MAY OWE A CONSUMER DEBT, YOU ARE GIVEN
31 CERTAIN PROTECTIONS AND RIGHTS BY NEW YORK AND FEDERAL LAWS REGULATING
32 DEBT COLLECTION PROCEDURES. YOU SHOULD BE AWARE OF YOUR RIGHTS AND
33 SHOULD NOT PERMIT YOUR RIGHTS TO BE VIOLATED. FOR MORE INFORMATION
34 ABOUT YOUR RIGHTS UNDER STATE AND FEDERAL DEBT COLLECTION PROCEDURES
35 LAW, CONTACT THE NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES AT
36 (INSERT THE CURRENT TELEPHONE NUMBER ESTABLISHED BY THE DEPARTMENT OF
37 FINANCIAL SERVICES FOR RECEIVING INQUIRIES FROM CONSUMERS) OR (INSERT
38 THE CURRENT ADDRESS OF THE WEBSITE OR WEBPAGE CREATED PURSUANT TO PARA-
39 GRAPH EIGHT OF SUBSECTION (C) OF SECTION THREE HUNDRED ONE OF THE FINAN-
40 CIAL SERVICES LAW). YOU MAY ALSO CONTACT THE NEW YORK STATE ATTORNEY
41 GENERAL AT (INSERT THE CURRENT TELEPHONE NUMBER ESTABLISHED BY THE
42 DEPARTMENT OF LAW FOR RECEIVING INQUIRIES FROM CONSUMERS) OR (INSERT THE
43 CURRENT ADDRESS OF THE WEBSITE OF THE DEPARTMENT OF LAW).
44 THE NOTICE REQUIRED BY THIS SUBDIVISION SHALL BE PRINTED OR WRITTEN IN
45 AT LEAST TEN POINT BOLD TYPE.
46 S 2. Subdivision 1 of section 602 of the general business law, as
47 added by chapter 753 of the laws of 1973, is amended to read as follows:
48 1. Except as otherwise provided by law, any person who [shall violate]
49 VIOLATES the terms OF SECTION SIX HUNDRED ONE of this article [shall be]
50 IS guilty of a misdemeanor, and each such violation shall be deemed a
51 separate offense. A VIOLATION BY ANY PERSON OF SECTION SIX HUNDRED ONE-A
52 OF THIS ARTICLE, IF SUCH VIOLATION CONSTITUTES THE FIRST SUCH OFFENSE BY
53 SUCH PERSON, IS PUNISHABLE BY A CIVIL PENALTY NOT TO EXCEED TWO HUNDRED
A. 606 3
1 FIFTY DOLLARS. THE SECOND OFFENSE AND ANY OFFENSE COMMITTED THEREAFTER
2 ARE PUNISHABLE BY A CIVIL PENALTY NOT TO EXCEED FIVE HUNDRED DOLLARS.
3 S 3. Paragraphs 6 and 7 of subsection (c) of section 301 of the finan-
4 cial services law, as added by section 1 of part A of chapter 62 of the
5 laws of 2011, are amended and a new paragraph 8 is added to read as
6 follows:
7 (6) providing technical assistance to local governments and not-for-
8 profits in the development of consumer protection measures with respect
9 to financial products and services; [and]
10 (7) continuing and expanding the detection, investigation and
11 prevention of insurance fraud[.]; AND
12 (8) ESTABLISHING A WEBSITE OR WEBPAGE THAT INCLUDES, BUT IS NOT LIMIT-
13 ED TO, INFORMATION REGARDING THE PROTECTION AND RIGHTS AFFORDED TO
14 CONSUMERS UNDER STATE AND FEDERAL LAWS REGULATING DEBT COLLECTION PROCE-
15 DURES, A SAMPLE INITIAL DEBT COLLECTION DISPUTE LETTER, A SAMPLE DEBT
16 COLLECTION CEASE AND DESIST LETTER, AND THE CURRENT CONTACT INFORMATION
17 FOR THE ATTORNEY GENERAL AND THE FEDERAL CONSUMER FINANCIAL PROTECTION
18 BUREAU.
19 S 4. This act shall take effect on the first of January next succeed-
20 ing the date on which it shall have become a law.
