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A00876 Text:

                STATE OF NEW YORK
                               2019-2020 Regular Sessions
                   IN ASSEMBLY
                                    January 11, 2019
        Introduced  by M. of A. QUART -- read once and referred to the Committee
          on Consumer Affairs and Protection
        AN ACT to amend the general business  law  and  the  executive  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-b to read as follows:
     3    §  601-b. Debt collection notice to consumers.  1. (a) As used in this
     4  section, "debt collection agency" shall mean a person,  firm  or  corpo-
     5  ration  engaged  in business, the principal purpose of which is to regu-
     6  larly collect or attempt to collect debts: (i) owed  or due or  asserted
     7  to  be owed or due to another; or (ii) obtained by, or assigned to, such
     8  person, firm or corporation,  that  are  in  default  when  obtained  or
     9  acquired by such person, firm or corporation.
    10    (b)  Such  term  shall  not  include:  (i) any person while serving or
    11  attempting to serve legal process on any other person in connection with
    12  the judicial enforcement of any debt;
    13    (ii) any attorney-at-law or law firm collecting a debt in such capaci-
    14  ty on behalf of and in the name of a  client  through  legal  activities
    15  such  as the filing and prosecution of lawsuits to reduce debts to judg-
    16  ments, but not any attorney-at-law or law firm which  regularly  engages
    17  in  activities  traditionally associated with debt collection, including
    18  but not limited to, sending demand letters or  making  collection  tele-
    19  phone calls;
    20    (iii)  any officer or employee of the United States, any state thereof
    21  or any political subdivision of any state to the extent that  collecting
    22  or  attempting  to collect any debt owed is in the performance of his or
    23  her official duties; or
    24    (iv) any non-profit organization which, at the request  of  consumers,
    25  performs  bona  fide consumer credit counseling and assists customers in
         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.

        A. 876                              2
     1  the liquidation of their debts by receiving payments from such customers
     2  and distributing such amounts to creditors.
     3    2. Each and every debt collection agency shall include in each initial
     4  correspondence  on  a  past due debt to a debtor a clear and conspicuous
     5  written statement of at least the following items, in substantially  the
     6  following  form,  to  be  clearly  and  conspicuously  labeled "Debtor's
     7  Rights":
     8                              "Debtor's Rights
     9    As a debtor who owes or may owe a consumer claim, you are  given  some
    10  protection  and  rights by the New York and federal laws regulating debt
    11  collection procedures.  You should be aware of your rights.
    12    1. A debt collector may contact you or any member of  your  family  or
    13  household directly. However, they may not contact you with such frequen-
    14  cy,  at  unusual  hours, or in a manner that can be expected to abuse or
    15  harass you. They also cannot threaten action which they do not  take  in
    16  the usual course of business.
    17    2.  A debt collector may not threaten to contact your employer regard-
    18  ing a debt prior to obtaining a final judgment against you.  However,  a
    19  debt  collector  may  contact your employer to execute a wage assignment
    20  agreement if you, the debtor, have agreed to the assignment.
    21    3. A debt collector cannot use a communication  which  appears  to  be
    22  authorized,  issued, or approved by a government agency or attorney when
    23  it is not.
    24    4. A debt collector cannot disclose or threaten to  disclose  informa-
    25  tion  affecting  your  reputation  for creditworthiness if the collector
    26  knows or has reason to know the information is false. A  debt  collector
    27  also  cannot attempt or threaten to enforce a right when it knows or has
    28  reason to know the right does not exist.
    29    For more information about your rights under state  and  federal  debt
    30  collection  procedures  law, contact the Consumer Protection Division of
    31  the New York State Department of State at (insert the current  telephone
    32  number  or internet website established by the consumer protection divi-
    33  sion for receiving inquiries from consumers).  You may also contact  the
    34  New  York State Attorney General at (insert the current telephone number
    35  established by the  department  of  law  for  receiving  inquiries  from
    36  consumers)  or (insert the current address of the website of the depart-
    37  ment of law)."
    38    The notice required by this subdivision shall be printed or written in
    39  at least ten point bold type.
    40    § 2. Subdivision 1 of section 602 of  the  general  business  law,  as
    41  added by chapter 753 of the laws of 1973, is amended to read as follows:
    42    1. Except as otherwise provided by law, any person who [shall violate]
    43  violates the terms of section six hundred one of this article [shall be]
    44  is  guilty  of  a misdemeanor, and each such violation shall be deemed a
    45  separate offense. A violation by any person of section six hundred one-b
    46  of this article, if such violation constitutes the first such offense by
    47  such person, is punishable by a civil penalty not to exceed two  hundred
    48  fifty  dollars.  The second offense and any offense committed thereafter
    49  are punishable by a civil penalty not to exceed five hundred dollars.
    50    § 3. Paragraphs 14 and 15 of subdivision 3  of  section  94-a  of  the
    51  executive  law,  as  added  by section 21 of part A of chapter 62 of the
    52  laws of 2011, are amended to read as follows:
    53    (14) cooperate with and assist consumers in class  actions  in  proper
    54  cases; [and]
    55    (15)  create  an internet website or webpage pursuant to section three
    56  hundred ninety-c of the general business law; and

        A. 876                              3
     1    (16) create an internet website or webpage that includes the "Debtor's
     2  Rights" form established pursuant to  subdivision  two  of  section  six
     3  hundred one-b of the general business law. Such website or webpage shall
     4  also  include,  but  not  limited  to,  a sample initial debt collection
     5  dispute  letter,  a  sample debt collection cease and desist letter, and
     6  the current contact information for the attorney general and the federal
     7  trade commission.
     8    § 4. This act shall take effect on the first of January next  succeed-
     9  ing the date on which it shall have become a law.
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