A08840 Summary:

BILL NO    A08840B

SAME AS    Same as S 6036

SPONSOR    Pheffer

COSPNSR    Jaffee

MLTSPNSR   Weinstein

Amd Art 29-H SS600 - 603-d, Gen Bus L

Relates to provisions concerning debt collection procedures.

A08840 Actions:

BILL NO    A08840B

06/11/2009 referred to consumer affairs and protection
06/16/2009 reported referred to codes
06/16/2009 amend and recommit to codes
06/16/2009 print number 8840a
06/17/2009 reported referred to rules
06/19/2009 amend and recommit to rules 8840b
06/22/2009 reported 
06/22/2009 rules report cal.616
06/22/2009 ordered to third reading rules cal.616
06/22/2009 passed assembly
06/22/2009 delivered to senate
06/22/2009 REFERRED TO RULES
01/06/2010 DIED IN SENATE
01/06/2010 RETURNED TO ASSEMBLY
01/06/2010 ordered to third reading cal.629

A08840 Votes:

BILL: A08840B DATE: 06/22/2009  MOTION:                       YEA/NAY: 105/035

Abbate  Y  Cahill  Y  Englebr Y  Hooper  Y  Maisel  Y  Powell  Y  Skartad Y
Alessi  Y  Calhoun NO Errigo  NO Hoyt    Y  Markey  ER Pretlow Y  Spano   Y
Alfano  NO Camara  Y  Espaill Y  Hyer-Sp Y  Mayerso Y  Quinn   NO Stirpe  Y
Amedore NO Canestr Y  Farrell Y  Jacobs  Y  McDonou ER Rabbitt NO Sweeney Y
Arroyo  ER Carrozz Y  Fields  Y  Jaffee  Y  McEneny Y  Raia    NO Tedisco NO
Aubry   Y  Castro  Y  Finch   NO Jeffrie Y  McKevit NO Ramos   Y  Thiele  NO
Bacalle NO Christe Y  Fitzpat NO John    Y  Meng    Y  Reilich NO Titone  Y
Ball    Y  Clark   Y  Gabrysz Y  Jordan  NO Miller  NO Reilly  Y  Titus   Y
Barclay NO Colton  Y  Galef   Y  Kavanag Y  Millman Y  Rive J  Y  Tobacco NO
Barra   NO Conte   Y  Gantt   Y  Kellner Y  Molinar Y  Rive N  ER Towns   Y
Barron  Y  Cook    Y  Gianari Y  Kolb    NO Morelle Y  Rive PM Y  Townsen Y
Benedet Y  Corwin  NO Gibson  Y  Koon    Y  Nolan   Y  Robinso Y  Walker  NO
Benjami Y  Crespo  Y  Giglio  NO Lancman Y  Oaks    NO Rosenth Y  Weinste Y
Bing    Y  Crouch  NO Glick   Y  Latimer Y  O'Donne Y  Russell Y  Weisenb Y
Boyland Y  Cusick  Y  Gordon  Y  Lavine  Y  O'Mara  NO Saladin NO Weprin  Y
Boyle   Y  Cymbrow Y  Gottfri Y  Lentol  Y  Ortiz   Y  Sayward NO Wright  Y
Bradley Y  DelMont Y  Gunther Y  Lifton  Y  Parment Y  Scarbor ER Zebrows Y
Brennan Y  DenDekk Y  Hawley  NO Lope PD NO Paulin  Y  Schimel Y  Mr Spkr Y
Brodsky Y  Destito Y  Hayes   NO Lope VJ Y  Peoples ER Schimmi NO
Brook-K Y  Dinowit Y  Heastie Y  Lupardo Y  Peralta Y  Schroed Y
Burling Y  Duprey  NO Hevesi  ER Magee   Y  Perry   ER Scozzaf NO
Butler  NO Eddingt Y  Hikind  ER Magnare Y  Pheffer Y  Seminer ER

A08840 Memo:

BILL NUMBER:A8840B

TITLE  OF BILL:  An act to amend the general business law, in relation
to debt collection procedures

Purpose Or General idea Of Bill:   The purpose  of  this  bill  is  to
protect   consumers  against  improper  and  abusive  debt  collection
practices.

Summary Of Specific Provisions:   This bill  would  implement  several
protections  against  improper  and abusive debt collection practices.
The bill would largely align New York law with the federal  Fair  Debt
Collection Practices Act.  Specifically, the bill would:

- provide that-creditors and debt collectors may only communicate with
debtors between the hours of 8:00 a.m. and 9:00 p.m. local time;

-  require  creditors and debt collectors to send a notice.to the last
known address of a debtor advising the debtor when his or her debt  is
being sold or transferred;

-  govern  how  debt  collectors may communicate with any person other
than the consumer for the purposes of acquiring  location  information
about the consumer in order to collect a debt;

- govern how debt collectors may communicate with a consumer after the
institution of debt collection procedures;

-  prohibit  debt  collectors  from engaging in threatening or abusive
conduct, making false, deceptive, or  misleading  representations,  or
using  any  unfair  or  unconscionable  means to collect or attempt to
collect a debt;

- require debt collectors to send the consumer a written notice titled
"debtor's rights" within five days after the initial communication  in
connection with a debt, which shall contain information about the debt
and a statement regarding the consumer's ability to dispute the debt;

-  provide  that  if the consumer, within thirty days of receiving the
"debtor's rights" notice, notifies the debt collector in writing  that
the  debt  is  disputed  the  debt  collector  shall  cease collection
activities until the collector  obtains  and  mails  to  the  consumer
verification of the debt;

-  provide  for a private right of action for actual damages, punitive
damages up to $2,500, and reasonable attorney's fees, for a  violation
of this article; and

-  provides  a  safe  harbor  for unintentional violations, absent any
actual damage to the consumer, and a two year statute of limitation.

Justification:   Many  consumers  today  are  finding  themselves  the
subjects of debt collection proceedings. Creditors and debt collectors
in  pursuit  of  collection  often fail to inform the consumers of the
important details  related  to  the  debt,  such  as  where  the  debt
originated,  or  the  name  and address of the original creditor. This
creates a frustrating process for a debtor who disputes all or part of


the claimed debt. In addition, consumers are  sometimes  subjected  to
persistent and abusive debt collection tactics.

In  the  past  four  years, the Consumer Protection Board has received
approximately 3,894 debt collection complaints and/or inquiries.  This
bill  would  provide  consumers  with adequate recourse to address the
kinds of improper practices described in those complaints, while still
allowing businesses to collect upon the debts owed to them.

The debt collection industry has changed significantly  since  Article
29-H  of the General Business-Law was enacted in 1973, and the federal
Fair Debt Collection Practices Act (FDCPA) was enacted in 1977.  Debts
are  often  sold  to  third  parties without consumers' knowledge, and
consumers are left to determine the validity of collection claims from
unknown entities. Indeed, a  recent  Federal  Trace  Commission  (FTC)
report  noted that "The most significant change in the debt collection
business in the past decade, however, has been the advent  and  growth
of  debt  buying  (i.e.  the  purchasing, collecting, and reselling of
debts in default)." The report recommended that the  FDCPA  should  be
amended  to  reflect  the  advent  and  expansion  of  the debt buying
industry. This bill would address this problem by requiring that  debt
collectors  provide  notice to consumers when their debt is sold. This
would allow consumers to determine the source and legitimacy  of  debt
collection notices they receive from third parties with whom they have
not had prior contact.

Consumers   also   need  recourse  against  improper  debt  collection
practices. Thus, the statute would incorporate the provisions  of  the
FDCPA  into  state  law, and provide consumers with a private right of
action to enforce the terms of this statute, and the right to  recover
actual damages.

By  largely aligning New York and federal law, this bill would provide
a consistent set of rules for debt collectors to follow, while  giving
consumers adequate remedies for stopping abusive practices.

Prior Legislative History:  New bill.

Fiscal Implications For State And Local Governments:  None.

Effective Date:  1st of January after having become law.