senate Bill S3317

2013-2014 Legislative Session

Requires disclosure by principal creditors and debt collection agencies of the legal obligations of a deceased debtor's family and household members

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Archive: Last Bill Status - In Committee


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 08, 2014 referred to consumer protection
Jan 31, 2013 referred to consumer protection

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S3317 - Bill Details

Current Committee:
Law Section:
General Business Law
Laws Affected:
Add §601-a, amd §600, Gen Bus L
Versions Introduced in Previous Legislative Sessions:
2011-2012: S3281
2009-2010: S5046A

S3317 - Bill Texts

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Requires disclosure by principal creditors and debt collection agencies of the legal obligations of a deceased debtor's family; requires such disclosure be both verbal and written.

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BILL NUMBER:S3317

TITLE OF BILL: An act to amend the general business law, in relation
to disclosure by principal creditors and debt collection agencies of
the legal obligations of a deceased debtor's family and household
members

PURPOSE OR GENERAL IDEA OF BILL: This bill would require that debt
collection agencies that are attempting to collect outstanding debts
of deceased. individuals from surviving family and household members
inform them, both orally and in writing, that they are not legally
obligated to repay the debts of the deceased.

SUMMARY OF SPECIFIC PROVISIONS:

Section one amends the general business law by adding a new section
601-a. This section requires that all principal creditors and/or debt
collection agencies must disclose to any relative or household member
of a deceased debtor that is contacted that he or she may not be
legally required to repay such deceased debtor's debts. This
disclosure must be made both orally and in writing. Any aggrieved
person may bring an action against such a practice and recover a civil
penalty. Class actions to recover damages are specifically authorized.

Section two amends section 600 of the general business law by adding a
new subdivision 4. This section defines 'debt collection agency'.

Section three sets out the effective date.

JUSTIFICATION: Recent investigations have shown that debt collection
companies often pursue payments from relatives of deceased debtors. A
New York Times article described the practices of a debt collection
agency whose agents are specially trained to employ "empathic active
listening" techniques to comfort grieving families while luring them
into paying the deceased's debts. This may be a violation of the Fair
Debt Collection Practices Act since this law prevents collection
companies from contacting anyone other than the debtor about
outstanding bills. Even if this practice is not illegal, this
legislation will ensure that debt collectors are required to notify
the relatives or household members that they contact that they have no
legal obligation to pay off the debt of the deceased. As it stands,
all relatives of deceased debtors are not required by law to assume
self loved ones' debts but collection agencies often omit this
information when they ask the relatives to make payments on
outstanding bills.

PRIOR LEGISLATIVE HISTORY:; 2009-10: S.5046A - Referred to Consumer
Protection

FISCAL IMPLICATIONS: None.

EFFECTIVE DATE: This act shall take effect on the ninetieth day after
it shall have become law.


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                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  3317

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 31, 2013
                               ___________

Introduced  by Sens. HASSELL-THOMPSON, KRUEGER -- read twice and ordered
  printed, and when printed to be committed to the Committee on Consumer
  Protection

AN ACT to amend the general business law, in relation to  disclosure  by
  principal  creditors  and  debt collection agencies of the legal obli-
  gations of a deceased debtor's family and household members

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. The general business law is amended by adding a new section
601-a to read as follows:
  S  601-A.  DISCLOSURE  BY  PRINCIPAL  CREDITORS AND/OR DEBT COLLECTION
AGENCIES. 1. ALL PRINCIPAL CREDITORS  AND/OR  DEBT  COLLECTION  AGENCIES
SHALL  DISCLOSE TO ANY RELATIVE OR HOUSEHOLD MEMBER OF A DECEASED DEBTOR
THAT IS CONTACTED THAT HE OR SHE MAY NOT BE LEGALLY  REQUIRED  TO  REPAY
SUCH  DECEASED  DEBTOR'S  DEBTS.    IN ADDITION, THE PRINCIPAL CREDITORS
AND/OR DEBT COLLECTION AGENCIES SHALL  NOT  MAKE  ANY  MISREPRESENTATION
ABOUT THE FAMILY MEMBER'S OBLIGATION TO PAY SUCH DEBTS.
  2.  DISCLOSURE REQUIRED UNDER SUBDIVISION ONE OF THIS SECTION SHALL BE
MADE BOTH ORALLY AND IN WRITING.
  3. IN ADDITION TO ANY RIGHT OF ACTION GRANTED TO THE ATTORNEY  GENERAL
PURSUANT  TO  THIS  ARTICLE, ANY AGGRIEVED PERSON MAY BRING AN ACTION TO
ENJOIN SUCH UNLAWFUL PRACTICE AND TO RECOVER A  CIVIL  PENALTY  OF  FIVE
THOUSAND  DOLLARS  FOR EACH VIOLATION, TOGETHER WITH ANY ACTUAL DAMAGES.
THE COURT SHALL AWARD REASONABLE ATTORNEY FEES AND COSTS TO A PREVAILING
PLAINTIFF. FOR PURPOSES OF THIS SECTION, EACH COMMUNICATION  THAT  FAILS
TO COMPLY WITH THIS SECTION SHALL CONSTITUTE A SEPARATE VIOLATION. CLASS
ACTIONS  TO  RECOVER  THE  DAMAGES SET FORTH IN THIS SECTION ARE SPECIF-
ICALLY AUTHORIZED.
  S 2. Section 600 of the general business law is amended  by  adding  a
new subdivision 4 to read as follows:

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD06432-01-3

S. 3317                             2

  4.  "DEBT  COLLECTION AGENCY" SHALL MEAN A PERSON, FIRM OR CORPORATION
ENGAGED IN BUSINESS, THE PRINCIPAL PURPOSE  OF  WHICH  IS  TO  REGULARLY
COLLECT  OR  ATTEMPT TO COLLECT DEBTS: (A) OWED OR DUE OR ASSERTED TO BE
OWED OR DUE TO ANOTHER; OR (B) OBTAINED BY, OR ASSIGNED TO, SUCH PERSON,
FIRM  OR  CORPORATION,  THAT ARE IN DEFAULT WHEN OBTAINED OR ACQUIRED BY
SUCH PERSON, FIRM OR CORPORATION.
  S 3. This act shall take effect on the ninetieth day  after  it  shall
have become a law.

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