NEW YORK STATE ASSEMBLY ADVANCES COLLECTION LEGISLATION
Unlike many other states, New York has generally not regulated creditors and debt collectors at the state level. Certain cities in New York have instead established extensive collection licensing and collection practices restrictions applicable to creditors, third party collectors and debt buyers. See, e.g., Debt Collection Digest entries for New York City for details. The New York State Assembly recently passed the following four pieces of legislation that may regulate principal creditors and debt collection agencies at the state level:
2007 Assembly Bill 8612 would amend the Debt Collection Procedure statute (“DCPS”), N.Y. Gen. Bus. Law §§ 600 et seq., to require a principal creditor to (i) include certain disclosures within past due notices, such as the date the debt was deemed in default and the accrued interest on the debt, and (ii) notify a debtor that his or her debt is being sold or transferred.
2007 Assembly Bill 7297 would amend the DCPS to require a principal creditor to cease collection activities upon receiving written notice from a debtor that he or she has been the victim of identity theft. After performing an investigation, a principal creditor may recommence collection activities upon making a good faith determination that the information provided by the debtor does not establish that the debtor is not responsible for the debt.
2007 Assembly Bill 221 would amend the DCPS to require a principal creditor to include a “Debtor’s Bill of Rights” in each initial
correspondence on a past due debt that explains certain debtor rights under New York law.
2007 Assembly Bill 8153 would enact a new Debt Collection Agencies statute that would require a person who acts as a debt collection agency to obtain a license.
The above bills have been delivered to the Senate for consideration and in some cases represent substituted Senate proposals.
- Mike Tomkies and Charles Gall