New York Assembly OK’s Broad Debt Collection Abuse Protection For Consumers
In an effort to protect consumers from the “exploding” debt collection industry, the state Assembly has passed a series of bills aimed at curbing abusive and unfair debt collection practices in New York State, Assemblymember Audrey Pheffer announced.
Pheffer said she sponsored the legislation as a result of the dramatic increase in the number of consumer complaints related to debt collection practices.
The Ozone Park/Rockaways lawmaker said complaints received from the Federal Trade Commission (FTC) regarding third-party debt collectors grew for the 10th consecutive year in 2007, and consumers filed more complaints with the FTC against third-party collectors than against any other specific industry.
Pheffer, chair of the Assembly Consumer Affairs Committee, was joined in her consumer protection effort by Assemblymember Michael Gianaris, who is sponsoring a measure that would substantially strengthen state laws to protect citizens from becoming victimized by unscrupulous debt collectors.
Pheffer stated, “Due to the vulnerable position consumers find themselves in when dealing with debt collectors, it is imperative that the state protect the interests, reputations and fiscal well-being of its citizens against these collectors who engage in abusive and unfair practices.”
The legislation passed by the Assembly would, if enacted, provide measures to: ensure that consumers are aware of their rights under New York’s Fair Debt Collection Practices Law; authorize the Consumer Protection Board to establish an administrative enforcement procedure to process complaints against debt collectors and prevent collectors from seizing income that is exempt from collection under state and federal law, such as Social Security and veterans’ benefits.
Pheffer’s package of bills includes measures that would require debt collectors to provide consumers with a “Debtor’s Bill of Rights” with each initial correspondence regarding a past due debt, amend the state Debt Collection Practices Law to create a private right of action by a debtor who has been a victim of improper debt collection practices (under Gianaris’ bill) and reform statutory provisions related to restraining debt collectors from accessing exempt funds, such as Social Security Retirement Supplemental Security Income (SSI) and Public Assistance.
A Pheffer bill in the package would also require third-party debt collectors and debt buyers to be licensed by the state Department of State, Pheffer said.
Gianaris explained: Debt collectors are already prohibited from employing unfair debt collection practices, but consumer complaints about these tactics continue to rise. It is essential that we empower consumers to bring an action against collectors who act improperly so that consumers have a recourse under the law and can deter future violations.”
Pheffer said the whole legislative package was developed following a public hearing conducted by her committee on Oct. 24, 2006, at which she took testimony from representatives of the New York City Department of Consumer Affairs, the Better Business Bureau serving metropolitan New York, the National Association Consumer Advocates and the New York State Collectors Association. Several economic justice advocates and representatives of legal service organizations also participated.
Article by John Toscano, The Queens Gazette
Is Your Debt Outside of the Statute of Limitations?
