New York A 5537: Relates to licensing consumer debt collectors

Bill Text

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A05537 Summary:

BILL NOA05537 

&nbsp

SAME ASNo Same As

&nbsp

SPONSORForrest

&nbsp

COSPNSRBurdick, Weprin, Taylor, Seawright, Shrestha

&nbsp

MLTSPNSR

&nbsp

Add Art 7 §§295 - 306, amd §§36 & 44, Bank L; amd §3218, add §5022, CPLR

&nbsp

Relates to licensing consumer debt collectors; sets minimum standards and regulations; establishes penalties for violations.

Go to top A05537 Actions:

BILL NOA05537 

&nbsp

02/14/2025referred to banks

01/07/2026referred to banks

Go to topA05537 Committee&nbspVotes:

Go to topA05537 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topA05537 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 5537

 2025-2026 Regular Sessions

 IN ASSEMBLY

 February 14, 2025
 ___________

 Introduced by M. of A. FORREST, BURDICK, WEPRIN, TAYLOR, SEAWRIGHT --
 read once and referred to the Committee on Banks

 AN ACT to amend the banking law and the civil practice law and rules, in
 relation to licensing consumer debt collectors

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. The banking law is amended by adding a new article 7 to
 2 read as follows:
 3 ARTICLE VII
 4 LICENSED CONSUMER DEBT COLLECTORS
 5 Section 295. Definitions.
 6 296. License required; entities exempt.
 7 297. Application for license; fees.
 8 298. Surety bond required.
 9 299. Examination; books and records; reports.
 10 300. Prohibited acts.
 11 301. Regulations; minimum standards.
 12 302. Application for acquisition of control of a consumer debt
 13 collector.
 14 303. Suspension and revocation.
 15 304. Bad actors.
 16 305. Penalties.
 17 306. Preemption of local law.
 18 § 295. Definitions. As used in this article:
 19 1. "Affiliated company" means a consumer debt collector operating
 20 under the control of a licensee, provided that the affiliated company
 21 shares common facilities, management, and operations with the licensee
 22 and the affiliated company does not engage in any collection activities
 23 other than debt buying or debt collection for the licensee.
 24 2. "Applicant" means a consumer debt collector who has filed an appli-
 25 cation to obtain a license under this article.

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD06314-02-5

 A. 5537 2

 1 3. "Attorney-at-law" and "law firm" means any attorney-at-law or law
 2 firm retained by a client for the purpose of litigation and representing
 3 such client through activities that may only be performed by a licensed
 4 attorney, including acting pursuant to law or regulation by contacting a
 5 consumer debtor in the course of the representation regarding antic-
 6 ipated, pending, or previous litigation.
 7 4. "Communication" and "communicate" means the conveying of informa-
 8 tion regarding a consumer debt directly or indirectly to any person
 9 through any medium.
 10 5. "Consumer debt" means any obligation of a natural person for the
 11 payment of money or its equivalent which arises out of a transaction
 12 which was primarily for personal, family, or household purposes. The
 13 term includes an obligation of a natural person who is a co-maker,
 14 endorser, guarantor or surety of such a transaction.
 15 6. "Consumer debtor" means any natural person who owes or is asserted
 16 to owe any consumer debt.
 17 7. "Consumer debt collector" means any person who engages in a busi-
 18 ness, a principal purpose of which is consumer debt buying, or regularly
 19 collecting or attempting to collect, directly or indirectly, consumer
 20 debts: (a) owed or due or asserted to be owed or due to another person;
 21 or (b) obtained by or assigned to such person that are in default when
 22 obtained or acquired by such person. The term includes any creditor who,
 23 in the process of collecting its own consumer debts, and uses any name
 24 other than its own which would reasonably indicate that a third person
 25 is collecting or attempting to collect a consumer debt.
 26 8. "Control" means the possession, direct or indirect, of the power to
 27 direct or cause the direction of the management and policies of a
 28 person, whether through the ownership of voting se