S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   9766
 
                           I N  A S S E M B L Y
 
                             February 6, 2018
                                ___________
 
 Introduced by M. of A. TITONE -- read once and referred to the Committee
   on Consumer Affairs and Protection
 
 AN  ACT to amend the general business law and the civil practice law and
   rules, in relation to debt collection agencies
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1. Legislative intent. The legislature hereby finds the pres-
 ence of consumer-related problems with respect to the practices of  debt
 collection agencies. Federal and state laws regulate how debt collectors
 may  communicate  with debtors and prohibit the use of certain threaten-
 ing, deceptive and unfair  collection  practices.  Despite  these  legal
 protections, the number of consumer complaints regarding debt collection
 practices  continue to rise. Consumer complaints received by the Federal
 Trade Commission regarding third-party  debt  collectors  grew  for  the
 thirteenth  consecutive  year  in  2010,  and  consumers  filed with the
 Commission more complaints against third-party collectors  than  against
 any  other specific industry. While the majority of those engaged in the
 business of debt collection are honest and ethical  in  their  dealings,
 there  is  a  minority  of unscrupulous collection agencies in operation
 that practice abusive tactics. Due to the sensitive nature of the infor-
 mation used in the course of such agency's everyday  business,  and  the
 vulnerable position consumers find themselves in when dealing with these
 agencies,  it  is  incumbent upon this legislature to protect the inter-
 ests, reputations and fiscal well-being of the citizens  of  this  state
 against  those  agencies  who  would abuse their privilege of operation.
 Therefore, it is herein declared that  the  state  should  license  debt
 collection agencies.
   §  2.  The  general  business  law  is amended by adding a new article
 29-HHH to read as follows:
                              ARTICLE 29-HHH
                         DEBT COLLECTION AGENCIES
 SECTION 604-K. DEFINITIONS.
         604-L. DEBT COLLECTION AGENCIES.
         604-M. SURETY BONDING REQUIREMENT.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
              

                       [ ] is old law to be omitted.
                                                            LBD00536-01-7

 A. 9766                             2
 
         604-N. PENALTIES.
         604-O. APPLICABILITY.
   §  604-K.  DEFINITIONS.  AS  USED IN THIS ARTICLE, THE FOLLOWING TERMS
 SHALL HAVE THE FOLLOWING MEANINGS:
   1. (A) "DEBT COLLECTION AGENCY" SHALL MEAN A PERSON,  FIRM  OR  CORPO-
 RATION  ENGAGED  IN BUSINESS, THE PRINCIPAL PURPOSE OF WHICH IS TO REGU-
 LARLY COLLECT OR ATTEMPT TO COLLECT DEBTS OWED OR DUE OR ASSERTED TO  BE
 OWED OR DUE TO ANOTHER AND SHALL ALSO INCLUDE A BUYER OF DELINQUENT DEBT
 WHO  SEEKS  TO COLLECT SUCH DEBT EITHER DIRECTLY OR THROUGH THE SERVICES
 OF ANOTHER BY, INCLUDING BUT NOT LIMITED TO, INITIATING OR  USING  LEGAL
 PROCESSES OR OTHER MEANS TO COLLECT OR ATTEMPT TO COLLECT SUCH DEBT.
   (B) THE TERM DOES NOT INCLUDE: (I) ANY OFFICER OR EMPLOYEE OF A CREDI-
 TOR WHILE, IN THE NAME OF THE CREDITOR, COLLECTING DEBTS FOR SUCH CREDI-
 TOR;
   (II) ANY OFFICER OR EMPLOYEE OF A DEBT COLLECTION AGENCY;
   (III)  ANY PERSON WHILE ACTING AS A DEBT COLLECTION AGENCY FOR ANOTHER
 PERSON, BOTH OF WHOM ARE RELATED BY COMMON OWNERSHIP  OR  AFFILIATED  BY
 CORPORATE CONTROL, IF THE PERSON ACTING AS A DEBT COLLECTION AGENCY DOES
 SO  ONLY  FOR  PERSONS TO WHOM IT IS SO RELATED OR AFFILIATED AND IF THE
 PRINCIPAL BUSINESS OF SUCH PERSON IS NOT THE COLLECTION OF DEBTS;
   (IV) ANY PERSON WHILE SERVING OR ATTEMPTING TO SERVE LEGAL PROCESS  ON
 ANY  OTHER  PERSON  IN  CONNECTION  WITH THE JUDICIAL ENFORCEMENT OF ANY
 DEBT;
   (V) ANY ATTORNEY-AT-LAW OR LAW FIRM COLLECTING A DEBT IN SUCH CAPACITY
 ON BEHALF OF AND IN THE NAME OF A CLIENT SOLELY THROUGH ACTIVITIES  THAT
 MAY  ONLY  BE PERFORMED BY A LICENSED ATTORNEY, BUT NOT ANY ATTORNEY-AT-
 LAW OR LAW FIRM OR PART THEREOF  WHO  REGULARLY  ENGAGES  IN  ACTIVITIES
 TRADITIONALLY  PERFORMED  BY DEBT COLLECTORS, INCLUDING, BUT NOT LIMITED
 TO, CONTACTING A DEBTOR THROUGH THE  MAIL  OR  VIA  TELEPHONE  WITH  THE
 PURPOSE  OF  COLLECTING A DEBT OR OTHER ACTIVITIES AS DETERMINED BY RULE
 OF THE SECRETARY;
   (VI) ANY PERSON EMPLOYED BY A UTILITY REGULATED UNDER  THE  PROVISIONS
 OF THE PUBLIC SERVICE LAW, ACTING FOR SUCH UTILITY;
   (VII)  ANY PERSON COLLECTING OR ATTEMPTING TO COLLECT ANY DEBT OWED OR
 DUE OR ASSERTED TO BE OWED OR DUE ANOTHER TO THE EXTENT  SUCH  ACTIVITY:
 (A)  IS  INCIDENTAL  TO  A BONA FIDE FIDUCIARY OBLIGATION OR A BONA FIDE
 ESCROW AGREEMENT; (B) CONCERNS A  DEBT  WHICH  WAS  ORIGINATED  BY  SUCH
 PERSON;  OR  (C) CONCERNS A DEBT WHICH WAS NOT IN DEFAULT AT THE TIME IT
 WAS OBTAINED BY SUCH PERSON AS A SECURED PARTY IN  A  COMMERCIAL  CREDIT
 TRANSACTION INVOLVING THE CREDITOR;
   (VIII) ANY OFFICER OR EMPLOYEE OF THE UNITED STATES, ANY STATE THEREOF
 OR  ANY POLITICAL SUBDIVISION OF ANY STATE TO THE EXTENT THAT COLLECTING
 OR ATTEMPTING TO COLLECT ANY DEBT OWED IS IN THE PERFORMANCE OF  HIS  OR
 HER OFFICIAL DUTIES;
   (IX)  ANY  NON-PROFIT ORGANIZATION WHICH, AT THE REQUEST OF CONSUMERS,
 PERFORMS BONA FIDE CONSUMER CREDIT COUNSELING AND ASSISTS  CUSTOMERS  IN
 THE LIQUIDATION OF THEIR DEBTS BY RECEIVING PAYMENTS FROM SUCH CUSTOMERS
 AND DISTRIBUTING SUCH AMOUNTS TO CREDITORS; OR
   (X) ANY PERSON, FIRM OR CORPORATION ENGAGED IN BUSINESS, THE PRINCIPAL
 PURPOSE  OF  WHICH  IS  TO REGULARLY COLLECT OR ATTEMPT TO COLLECT DEBTS
 OWED OR DUE OR ASSERTED TO BE OWED OR DUE TO ANOTHER  PERSON  WHERE  THE
 DEBT  IS  ENFORCED  FOR  CHILD  SUPPORT, SPOUSAL SUPPORT, MAINTENANCE OR
 ALIMONY, PROVIDED, HOWEVER, THAT IF SUCH  PERSON,  FIRM  OR  CORPORATION
 ALSO  REGULARLY  COLLECTS  OR ATTEMPTS TO COLLECT DEBTS OTHER THAN THOSE
 ENFORCED FOR CHILD SUPPORT, SPOUSAL  SUPPORT,  MAINTENANCE  OR  ALIMONY,
 SUCH PERSON MUST COMPLY WITH THE REQUIREMENTS OF THIS ARTICLE.

 A. 9766                             3
 
   2.  "CONSUMER"  MEANS  ANY NATURAL PERSON OBLIGATED OR ALLEGEDLY OBLI-
 GATED TO PAY ANY DEBT.
   3.  "DEBT" MEANS ANY OBLIGATION OR ALLEGED OBLIGATION OF A CONSUMER TO
 PAY MONEY ARISING OUT OF A TRANSACTION IN  WHICH  THE  MONEY,  PROPERTY,
 INSURANCE,  OR  SERVICES  WHICH  ARE  THE SUBJECT OF THE TRANSACTION ARE
 PRIMARILY FOR PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES,  WHETHER  OR  NOT
 SUCH OBLIGATION HAS BEEN REDUCED TO JUDGMENT.
   4. "DEPARTMENT" MEANS THE DEPARTMENT OF STATE.
   5. "DIVISION" MEANS THE DIVISION OF CRIMINAL JUSTICE SERVICES.
   6. "SECRETARY" MEANS THE SECRETARY OF STATE.
   §  604-L.  DEBT COLLECTION AGENCIES. 1. ON OR AFTER OCTOBER FIRST, TWO
 THOUSAND EIGHTEEN, NO PERSON SHALL ACT AS A DEBT COLLECTION AGENCY WITH-
 OUT FIRST HAVING OBTAINED A LICENSE IN ACCORDANCE WITH THE PROVISIONS OF
 THIS ARTICLE, AND WITHOUT FIRST  BEING  IN  COMPLIANCE  WITH  ALL  OTHER
 APPLICABLE LAWS, RULES AND REGULATIONS.
   2. (A) ALL LICENSES ISSUED PURSUANT TO THIS ARTICLE SHALL BE VALID FOR
 TWO YEARS UNLESS SOONER SUSPENDED OR REVOKED. THE SECRETARY SHALL ESTAB-
 LISH BY REGULATION THE EXPIRATION DATE OF SUCH LICENSES.
   (B)  THE  FEE  FOR  A LICENSE OR RENEWAL THEREOF SHALL BE FIVE HUNDRED
 DOLLARS.
   3. (A) EACH PERSON APPLYING FOR A DEBT COLLECTION  AGENCY  LICENSE  OR
 RENEWAL THEREOF SHALL FILE AN APPLICATION IN SUCH FORM AND DETAIL AS THE
 SECRETARY MAY PRESCRIBE AND SHALL PAY THE FEE REQUIRED BY THIS SECTION.
   (B) IN ADDITION TO ANY OTHER INFORMATION REQUIRED, THE SECRETARY SHALL
 REQUIRE  THE  FOLLOWING  INFORMATION, AND SHALL, AS APPROPRIATE, REQUIRE
 SUCH INFORMATION NOT ONLY OF THE APPLICANT BUT ALSO OF ANY OF ITS  PRIN-
 CIPALS,  PARTNERS,  OFFICERS  AND  DIRECTORS,  OR  ANY  PERSON OR ENTITY
 CONTROLLING AN INTEREST GREATER THAN TEN PERCENT:
   (I) THE NAME AND RESIDENCE ADDRESS OF THE APPLICANT;
   (II) THE BUSINESS NAME, IF OTHER THAN APPLICANT;
   (III) THE PLACE, INCLUDING THE CITY, TOWN OR VILLAGE, WITH THE  STREET
 AND NUMBER, WHERE THE BUSINESS IS TO BE LOCATED;
   (IV) THE BUSINESS TELEPHONE OF THE APPLICANT;
   (V)  THE  LENGTH OF TIME THAT THE APPLICANT HAS BEEN A DEBT COLLECTION
 AGENCY;
   (VI) A STATEMENT INDICATING WHETHER THE APPLICANT HAS:
   (A) BEEN CONVICTED OF ANY CRIME OR IS A DEBTOR  ON  ANY  UNPAID  CIVIL
 JUDGMENT RELATING TO WORK AS A DEBT COLLECTION AGENCY; AND
   (B)  AT  ANY  TIME  IN THE PAST BEEN ISSUED A LICENSE PURSUANT TO THIS
 ARTICLE, OR HAS BEEN ISSUED A LICENSE FOR DEBT COLLECTION ACTIVITIES  BY
 ANY  OTHER STATE OR LOCAL AUTHORITY, AND IF SO, WHETHER SUCH LICENSE WAS
 EVER REVOKED OR SUSPENDED;
   (VII) A DETAILED DESCRIPTION OF  THE  BUSINESS  PRACTICES  OR  METHODS
 USED,  OR  INTENDED TO BE USED, BY THE APPLICANT TO CONFIRM THE VALIDITY
 OF THE DEBTS IT SEEKS TO COLLECT FROM CONSUMERS;
   (VIII) A SUMMARY OF THE APPLICANT'S RECORD-KEEPING POLICY,  INCLUDING,
 BUT NOT LIMITED TO:
   (A)  THE  LENGTH  OF TIME THE APPLICANT MAINTAINS, OR INTENDS TO MAIN-
 TAIN, RECORDS PERTAINING TO CONSUMERS; AND
   (B) THE MANNER IN WHICH THE APPLICANT RECORDS AND STORES,  OR  INTENDS
 TO  RECORD AND STORE: CONSUMER CHALLENGES TO THE VALIDITY OF DEBT; BILL-
 ING ERRORS; PAYMENTS MADE BY A CONSUMER; SETTLEMENT AGREEMENTS; INFORMA-
 TION REGARDING PARTIES RESPONSIBLE FOR DEBT; ANY STATEMENTS  MADE  BY  A
 CONSUMER  ALLEGING  THAT  THE  DEBT  AROSE  FROM IDENTITY THEFT; AND ANY
 STATEMENTS MADE BY A CONSUMER STATING THAT THE CONSUMER RECEIVED  STATU-

 A. 9766                             4
 
 TORILY  EXEMPT INCOME AS DEFINED IN SECTION FIFTY-TWO HUNDRED TWENTY-TWO
 OF THE CIVIL PRACTICE LAW AND RULES;
   (IX) WHETHER THE APPLICANT REGULARLY SELLS, OR INTENDS TO SELL, DEBTS.
 IF  THE  APPLICANT SELLS, OR INTENDS TO SELL DEBTS, SUCH APPLICANT SHALL
 BE REQUIRED TO PROVIDE THE SECRETARY WITH A SUMMARY OF  THE  APPLICANT'S
 POLICY  WITH  RESPECT  TO THE INFORMATION REGARDING A CONSUMER'S ACCOUNT
 THAT IT TRANSMITS, OR WILL TRANSMIT, TO THE PURCHASER OF A DEBT; AND
   (X) A SWORN STATEMENT BY THE APPLICANT THAT THE INFORMATION SET  FORTH
 IN THE APPLICATION IS CURRENT AND ACCURATE.
   (C)  AN APPLICANT WHO IS A NON-RESIDENT OF THE STATE SHALL PROVIDE THE
 NAME AND ADDRESS OF A REGISTERED AGENT WITHIN THE STATE OR DESIGNATE THE
 SECRETARY AS HIS OR HER AGENT UPON WHOM PROCESS  OR  OTHER  NOTIFICATION
 MAY BE SERVED.
   4.  IN  DETERMINING WHETHER TO ISSUE OR RENEW A LICENSE, THE SECRETARY
 SHALL CONSIDER THE CHARACTER, COMPETENCY AND INTEGRITY OF THE APPLICANT.
 THE SECRETARY MAY REFUSE TO ISSUE OR RENEW A LICENSE TO ANY PERSON, FIRM
 OR CORPORATION WHOM HE OR SHE FINDS HAS: (A) BEEN CONVICTED OF ANY CRIME
 DEFINED IN ARTICLE ONE HUNDRED FIFTY-FIVE OF THE PENAL  LAW  OR  ARTICLE
 TWENTY-TWO-A  OF  THIS CHAPTER OR FAILED TO PAY ANY FINAL CIVIL JUDGMENT
 RELATING TO WORK AS A DEBT COLLECTION AGENCY, IF SUCH  REFUSAL,  IN  THE
 JUDGMENT  OF THE SECRETARY, BEST PROMOTES THE INTERESTS OF THE PEOPLE OF
 THIS STATE; OR
   (B) VIOLATED ARTICLE TWENTY-NINE-H OF THIS CHAPTER OR THE FEDERAL FAIR
 DEBT COLLECTION PRACTICES ACT (15 USC § 1692 ET SEQ.).
   ALL DETERMINATIONS BY THE SECRETARY TO ISSUE OR RENEW A LICENSE  SHALL
 BE  MADE  IN  ACCORDANCE WITH SUBDIVISION SIXTEEN OF SECTION TWO HUNDRED
 NINETY-SIX OF THE  EXECUTIVE  LAW  AND  ARTICLE  TWENTY-THREE-A  OF  THE
 CORRECTION LAW.
   5.  NOTICE IN WRITING IN THE MANNER AND FORM PRESCRIBED BY THE DEPART-
 MENT SHALL BE GIVEN TO THE DEPARTMENT AT ITS OFFICES  IN  ALBANY  WITHIN
 TEN DAYS OF CHANGES OF NAME OR ADDRESS BY LICENSED DEBT COLLECTION AGEN-
 CIES.  THE FEE FOR FILING EACH CHANGE OF NAME OR ADDRESS NOTICE SHALL BE
 TEN DOLLARS.
   6. THE FEES ESTABLISHED BY THIS SECTION SHALL NOT BE REFUNDABLE.
   7.  EACH  DEBT  COLLECTION  AGENCY  ENGAGED  IN COLLECTING DEBTS SHALL
 COMMUNICATE HIS OR HER LICENSE NUMBER UPON THE REQUEST OF ANY INTERESTED
 PARTY. ANY ADVERTISEMENT, LETTERHEAD, RECEIPT OR OTHER PRINTED MATTER OF
 A LICENSEE MUST CONTAIN THE LICENSE NUMBER ASSIGNED TO THE  LICENSEE  BY
 THE  DEPARTMENT.  SUCH LICENSE NUMBER SHALL BE CLEARLY AND CONSPICUOUSLY
 DISPLAYED.
   8. NO PERSON, FIRM OR CORPORATION SHALL: (A) PRESENT,  OR  ATTEMPT  TO
 PRESENT, AS HIS, HER OR ITS OWN, THE LICENSE NUMBER OF ANOTHER;
   (B)  KNOWINGLY GIVE FALSE EVIDENCE OF A MATERIAL NATURE TO THE DEPART-
 MENT FOR THE PURPOSE OF PROCURING A LICENSE;
   (C) FALSELY REPRESENT THEMSELVES TO  BE  A  LICENSED  DEBT  COLLECTION
 AGENCY;
   (D) USE OR ATTEMPT TO USE A LICENSE WHICH HAS EXPIRED;
   (E) OFFER TO PERFORM OR PERFORM ANY COLLECTION OF DEBTS WITHOUT HAVING
 A CURRENT LICENSE AS IS REQUIRED UNDER THIS ARTICLE; OR
   (F)  REPRESENT  IN ANY MANNER THAT HIS, HER OR ITS LICENSE CONSTITUTES
 AN ENDORSEMENT OF THE QUALITY OF WORKMANSHIP OR COMPETENCY OF  THE  DEBT
 COLLECTION AGENCY.
   9. LICENSES ISSUED TO DEBT COLLECTION AGENCIES SHALL NOT BE TRANSFERA-
 BLE OR ASSIGNABLE.
   10.  THE  SECRETARY  SHALL  ISSUE EACH DEBT COLLECTION AGENCY A UNIQUE
 LICENSE NUMBER.

 A. 9766                             5
 
   11. THE DEPARTMENT SHALL  MAINTAIN  AND  PUBLISH  A  REGISTRY  OF  ALL
 LICENSED  DEBT  COLLECTION  AGENCIES, WHICH SHALL LIST AND IDENTIFY, ALL
 LICENSED DEBT COLLECTION AGENCIES DOING  BUSINESS  IN  THIS  STATE.  THE
 DEPARTMENT SHALL MAKE THE REGISTRY AVAILABLE ON ITS WEBSITE.
   12.  (A) THE SECRETARY SHALL ADOPT SUCH RULES AND REGULATIONS AS HE OR
 SHE MAY DETERMINE ARE NECESSARY FOR THE ADMINISTRATION  AND  ENFORCEMENT
 OF   THIS  ARTICLE,  AND  SHALL  PROVIDE  WRITTEN  NOTIFICATION  OF  THE
 PROVISIONS OF THIS ARTICLE TO  ALL  DEBT  COLLECTION  AGENCIES  LICENSED
 PURSUANT TO THIS ARTICLE.
   (B)  IN  ADDITION TO ANY OTHER POWERS OF THE SECRETARY, NOT IN LIMITA-
 TION THEREOF, HE OR SHE SHALL HAVE THE POWER TO ENFORCE  THE  PROVISIONS
 OF  THIS  ARTICLE,  TO INVESTIGATE ANY VIOLATION THEREOF, TO INVESTIGATE
 THE BUSINESS, BUSINESS  PRACTICES  AND  BUSINESS  METHODS  OF  ANY  DEBT
 COLLECTION  AGENCY, AND TO CONDUCT ROUTINE EXAMINATIONS OF THE FINANCIAL
 SOLVENCY OF ANY DEBT COLLECTION AGENCY, IF IN THE OPINION OF THE  SECRE-
 TARY,   SUCH  INVESTIGATION  OR  EXAMINATION  IS  WARRANTED.  EACH  DEBT
 COLLECTION AGENCY SHALL BE OBLIGED,  ON  REQUEST  OF  THE  SECRETARY  OF
 STATE,  TO  SUPPLY  SUCH INFORMATION, BOOKS, PAPERS OR RECORDS AS MAY BE
 REQUIRED CONCERNING HIS, HER OR  ITS  BUSINESS,  BUSINESS  PRACTICES  OR
 BUSINESS  METHODS, OR PROPOSED BUSINESS PRACTICES OR METHODS. FAILURE TO
 COMPLY WITH A LAWFUL REQUEST OF THE SECRETARY  SHALL  BE  A  GROUND  FOR
 DENYING  AN  APPLICATION  FOR A LICENSE, OR FOR REVOKING, SUSPENDING, OR
 FAILING TO RENEW A LICENSE  ISSUED UNDER THIS ARTICLE.
   (C) THE DEPARTMENT SHALL HAVE THE  POWER  TO  REVOKE  OR  SUSPEND  ANY
 LICENSE,  OR  IN LIEU THEREOF TO IMPOSE A FINE NOT LESS THAN ONE HUNDRED
 DOLLARS NOR MORE THAN TWO THOUSAND DOLLARS PER  VIOLATION  OR  INSTANCE,
 PAYABLE TO THE DEPARTMENT, OR REPRIMAND ANY LICENSEE OR DENY AN APPLICA-
 TION FOR A LICENSE OR RENEWAL THEREOF UPON PROOF:
   (I)  THAT THE APPLICANT OR LICENSEE HAS VIOLATED ANY OF THE PROVISIONS
 OF THIS ARTICLE OR THE RULES AND  REGULATIONS  PROMULGATED  PURSUANT  TO
 THIS ARTICLE;
   (II)  THAT  THE  APPLICANT  OR LICENSEE HAS PRACTICED FRAUD, DECEIT OR
 MISREPRESENTATION;
   (III) THAT THE APPLICANT OR LICENSEE HAS MADE A MATERIAL  MISSTATEMENT
 IN THE APPLICATION FOR OR RENEWAL OF HIS OR HER LICENSE; OR
   (IV)  THAT  THE APPLICANT OR LICENSEE HAS DEMONSTRATED INCOMPETENCE OR
 UNTRUSTWORTHINESS IN HIS OR HER ACTIONS.
   13. THE DEPARTMENT SHALL BEFORE DENYING AN APPLICATION FOR  A  LICENSE
 OR  BEFORE  REVOKING  OR SUSPENDING ANY LICENSE, OR IMPOSING ANY FINE OR
 REPRIMAND, AND AT LEAST FIFTEEN DAYS PRIOR TO THE DATE SET FOR THE HEAR-
 ING, AND UPON DUE NOTICE TO THE COMPLAINANT OR OBJECTOR, NOTIFY IN WRIT-
 ING THE APPLICANT, OR THE HOLDER OF SUCH LICENSE, OF ANY CHARGE MADE AND
 SHALL AFFORD SUCH APPLICANT OR LICENSEE AN OPPORTUNITY TO  BE  HEARD  IN
 PERSON  OR  BY  COUNSEL IN REFERENCE THERETO. SUCH WRITTEN NOTICE MAY BE
 SERVED PERSONALLY TO THE APPLICANT OR LICENSEE, OR BY CERTIFIED MAIL  TO
 THE LAST KNOWN BUSINESS ADDRESS OF SUCH APPLICANT OR LICENSEE.
   14. THE HEARING ON SUCH CHARGES SHALL BE AT SUCH TIME AND PLACE AS THE
 DEPARTMENT  SHALL  PRESCRIBE  AND  SHALL BE CONDUCTED BY SUCH OFFICER OR
 PERSON IN THE DEPARTMENT AS THE SECRETARY MAY DESIGNATE, WHO SHALL  HAVE
 THE  POWER TO SUBPOENA AND BRING BEFORE THE OFFICER, OR PERSON SO DESIG-
 NATED, ANY PERSON IN THIS STATE AND  ADMINISTER  AN  OATH  TO  AND  TAKE
 TESTIMONY  OF  ANY  PERSON OR CAUSE HIS OR HER DEPOSITION TO BE TAKEN. A
 SUBPOENA ISSUED UNDER THIS SECTION SHALL BE REGULATED BY THE CIVIL PRAC-
 TICE LAW AND RULES. SUCH OFFICER OR PERSON IN THE DEPARTMENT  DESIGNATED
 TO  TAKE  SUCH  TESTIMONY  SHALL NOT BE BOUND BY COMMON LAW OR STATUTORY
 RULES OF EVIDENCE OR BY TECHNICAL OR FORMAL RULES OF PROCEDURE.

 A. 9766                             6
 
   15. IN THE EVENT THAT THE DEPARTMENT SHALL DENY THE  APPLICATION  FOR,
 OR  REVOKE OR SUSPEND ANY SUCH LICENSE, OR IMPOSE ANY FINE OR REPRIMAND,
 ITS DETERMINATION  SHALL  BE  IN  WRITING  AND  OFFICIALLY  SIGNED.  THE
 ORIGINAL  OF  SUCH DETERMINATIONS, WHEN SO SIGNED, SHALL BE FILED IN THE
 OFFICE  OF  THE  DEPARTMENT  AND  COPIES  THEREOF SHALL BE MAILED TO THE
 APPLICANT OR LICENSEE AND TO THE COMPLAINANT WITHIN TWO DAYS AFTER  SUCH
 FILING.
   16.  THE  DEPARTMENT,  ACTING  BY  THE  OFFICE OR PERSON DESIGNATED TO
 CONDUCT THE HEARING PURSUANT TO SUBDIVISION THIRTEEN OF THIS SECTION  OR
 BY  SUCH  OTHER  OFFICER OR PERSON IN THE DEPARTMENT AS THE SECRETARY OF
 STATE MAY DESIGNATE, SHALL HAVE THE POWER TO SUSPEND THE LICENSE OF  ANY
 LICENSEE  WHO  HAS  BEEN  CONVICTED  IN THIS STATE OR ANY OTHER STATE OR
 TERRITORY OF A FELONY OR OF ANY MISDEMEANOR FOR A PERIOD  NOT  EXCEEDING
 THIRTY  DAYS  PENDING  A  HEARING  AND  A  DETERMINATION OF CHARGES MADE
 AGAINST HIM OR HER. IF SUCH HEARING IS ADJOURNED AT THE REQUEST  OF  THE
 LICENSEE, OR BY REASON OF ANY ACT OR OMISSION BY HIM OR HER OR ON HIS OR
 HER  BEHALF,  SUCH SUSPENSION MAY BE CONTINUED FOR THE ADDITIONAL PERIOD
 OF SUCH ADJOURNMENT.
   17. THE ACTION OF THE DEPARTMENT IN GRANTING OR REFUSING TO  GRANT  OR
 TO  RENEW  A  LICENSE UNDER THIS ARTICLE OR IN REVOKING OR SUSPENDING OR
 REFUSING TO REVOKE OR SUSPEND SUCH A LICENSE OR  IMPOSING  ANY  FINE  OR
 REPRIMAND  SHALL  BE  SUBJECT TO REVIEW BY A PROCEEDING INSTITUTED UNDER
 ARTICLE SEVENTY-EIGHT OF  THE  CIVIL  PRACTICE  LAW  AND  RULES  AT  THE
 INSTANCE  OF  THE APPLICANT FOR SUCH LICENSE, THE HOLDER OF A LICENSE SO
 REVOKED, SUSPENDED, FINED OR REPRIMANDED.
   18. FOR THE PURPOSE OF THIS ARTICLE, LICENSEES MAY BE HELD RESPONSIBLE
 FOR STATEMENTS, REPRESENTATIONS, PROMISES OR ACTS OF THEIR EMPLOYEES  OR
 THEIR  AGENTS  WITHIN  THE  SCOPE OF THEIR AUTHORITY; PROVIDED, HOWEVER,
 THAT LICENSEES SHALL NOT BE HELD RESPONSIBLE FOR STATEMENTS, REPRESENTA-
 TIONS, PROMISES OR ACTS WHICH ARE  CONTRARY  TO  INSTRUCTIONS  OR  WHICH
 CONSTITUTE  GROSS  NEGLIGENCE  OR  INTENTIONAL TORTS UNLESS SPECIFICALLY
 AUTHORIZED BY THE LICENSEE.
   19. (A) ANY PERSON, FIRM  OR  CORPORATION  THAT  OPERATES  AS  A  DEBT
 COLLECTION  AGENCY  WITHOUT  A  LICENSE SHALL BE REQUIRED TO PAY A CIVIL
 PENALTY TO THE DEPARTMENT OF NOT MORE  THAN  FIVE  HUNDRED  DOLLARS  PER
 ATTEMPT TO COLLECT A DEBT IN VIOLATION OF THIS SECTION.
   (B)  IN  ADDITION TO ANY OTHER PENALTIES, IF A PERSON IS FOUND TO HAVE
 COMMITTED REPEATED, MULTIPLE OR PERSISTENT VIOLATIONS OF  ANY  PROVISION
 OF  THIS  ARTICLE,  SUCH  PERSON  MAY BE RESPONSIBLE FOR THE COST OF THE
 DEPARTMENT'S INVESTIGATION.
   § 604-M. SURETY BONDING REQUIREMENT. 1. AS A CONDITION OF OBTAINING  A
 LICENSE PURSUANT TO THIS ARTICLE, EVERY DEBT COLLECTION AGENCY APPLICANT
 WHO  IS APPLYING FOR A LICENSE AND EMPLOYS BETWEEN ONE AND FOUR INDIVID-
 UALS ENGAGED IN THE COLLECTION OF DEBTS SHALL  OBTAIN  AND  CONTINUE  IN
 FULL  FORCE  AND  EFFECT  A  BOND, CONTRACT OF INDEMNITY, OR IRREVOCABLE
 LETTER OF CREDIT IN THE AMOUNT OF TEN THOUSAND DOLLARS TO BE FILED  WITH
 THE SECRETARY.
   2.  AS  A  CONDITION  TO OBTAINING A LICENSE PURSUANT TO THIS ARTICLE,
 EVERY DEBT COLLECTION AGENCY APPLICANT WHO IS APPLYING FOR A LICENSE AND
 EMPLOYS BETWEEN FIVE AND NINE INDIVIDUALS ENGAGED IN THE  COLLECTION  OF
 DEBTS  SHALL  OBTAIN  AND  CONTINUE  IN  FULL  FORCE  AND EFFECT A BOND,
 CONTRACT OF INDEMNITY, OR IRREVOCABLE LETTER OF CREDIT IN THE AMOUNT  OF
 TWENTY-FIVE THOUSAND DOLLARS TO BE FILED WITH THE SECRETARY.
   3.  AS  A  CONDITION  TO OBTAINING A LICENSE PURSUANT TO THIS ARTICLE,
 EVERY DEBT COLLECTION AGENCY APPLICANT WHO IS APPLYING FOR A LICENSE AND
 EMPLOYS BETWEEN TEN AND TWENTY INDIVIDUALS ENGAGED IN THE COLLECTION  OF

 A. 9766                             7
 
 DEBTS  SHALL  OBTAIN  AND  CONTINUE  IN  FULL  FORCE  AND EFFECT A BOND,
 CONTRACT OF INDEMNITY, OR IRREVOCABLE LETTER OF CREDIT IN THE AMOUNT  OF
 FIFTY THOUSAND DOLLARS TO BE FILED WITH THE SECRETARY.
   4.  AS  A  CONDITION  TO OBTAINING A LICENSE PURSUANT TO THIS ARTICLE,
 EVERY DEBT COLLECTION AGENCY APPLICANT WHO IS APPLYING FOR A LICENSE AND
 EMPLOYS TWENTY OR MORE INDIVIDUALS ENGAGED IN THE  COLLECTION  OF  DEBTS
 SHALL  OBTAIN  AND CONTINUE IN FULL FORCE AND EFFECT A BOND, CONTRACT OF
 INDEMNITY, OR IRREVOCABLE LETTER OF CREDIT, IN THE  AMOUNT  OF  SEVENTY-
 FIVE THOUSAND DOLLARS TO BE FILED WITH THE SECRETARY.
   5.  SUCH  SURETY BOND, CONTRACT OF INDEMNITY, OR IRREVOCABLE LETTER OF
 CREDIT SHALL BE CONDITIONED THAT THE APPLICANT  WILL  COMPLY  WITH  THIS
 ARTICLE, ARTICLE TWENTY-NINE-H, AND ARTICLE TWENTY-NINE-HH OF THIS CHAP-
 TER  AND PAY ALL CIVIL PENALTIES, FINES, OR OTHER OBLIGATIONS IMPOSED BY
 THE SECRETARY OR A COURT OF LAW,  INVESTIGATORY  COSTS  REQUIRED  TO  BE
 PAID,  OR ANY FINAL JUDGMENT AGAINST THE LICENSEE PURSUANT TO SUCH ARTI-
 CLES.
   6. THE TOTAL LIABILITY IMPOSED ON THE SURETY BOND UNDER  THIS  SECTION
 FOR  ALL BREACHES OF THE BOND CONDITION IS LIMITED TO THE FACE AMOUNT OF
 THE BOND. SUCH LIABILITY IS LIMITED TO THE  AMOUNT  OF  THE  PENALTY  OR
 INVESTIGATORY COSTS. IN NO EVENT WILL THE SURETY ON A BOND BE LIABLE FOR
 TOTAL  CLAIMS  IN EXCESS OF THE BOND AMOUNT, REGARDLESS OF THE NUMBER OR
 NATURE OF CLAIMS MADE AGAINST THE BOND OR THE NUMBER OF YEARS  THE  BOND
 REMAINED IN FORCE.
   7. ANY SURETY ISSUING A BOND PURSUANT TO THIS SECTION AND ANY LICENSEE
 SHALL  BE  REQUIRED TO PROVIDE THIRTY DAYS NOTICE TO THE SECRETARY PRIOR
 TO THE EFFECTIVE DATE OF CANCELLATION OF THE BOND. THE FAILURE TO  MAIN-
 TAIN  SUCH  A  BOND  SHALL  OPERATE  TO  REVOKE  THE LICENSE OF THE DEBT
 COLLECTION AGENCY UPON NOTICE AND HEARING.
   § 604-N. PENALTIES. 1.  WHEREVER THERE SHALL BE A  VIOLATION  OF  THIS
 ARTICLE,  AN APPLICATION MAY BE MADE BY THE ATTORNEY GENERAL IN THE NAME
 OF THE PEOPLE OF THE STATE OF NEW YORK TO  A  COURT  OR  JUSTICE  HAVING
 JURISDICTION  BY  A  SPECIAL PROCEEDING TO ISSUE AN INJUNCTION, AND UPON
 NOTICE TO THE DEFENDANT OF  NOT  LESS  THAN  FIVE  DAYS,  TO  ENJOIN  OR
 RESTRAIN  THE  CONTINUANCE  OF SUCH VIOLATION; AND IF IT SHALL APPEAR TO
 THE SATISFACTION OF THE COURT OR JUSTICE  THAT  THE  DEFENDANT  HAS,  IN
 FACT,  VIOLATED  THIS SECTION, AN INJUNCTION MAY BE ISSUED BY SUCH COURT
 OR JUSTICE, ENJOINING AND RESTRAINING  ANY  FURTHER  VIOLATION,  WITHOUT
 REQUIRING  PROOF  THAT  ANY PERSON HAS, IN FACT, BEEN INJURED OR DAMAGED
 THEREBY. IN ANY SUCH PROCEEDING, THE COURT MAY MAKE  ALLOWANCES  TO  THE
 ATTORNEY  GENERAL  AS  PROVIDED  IN  PARAGRAPH SIX OF SUBDIVISION (A) OF
 SECTION EIGHTY-THREE HUNDRED THREE OF THE CIVIL PRACTICE LAW AND  RULES,
 AND  DIRECT  RESTITUTION.  WHENEVER  THE  COURT  SHALL  DETERMINE THAT A
 VIOLATION OF THIS SECTION HAS OCCURRED, THE COURT  MAY  IMPOSE  A  CIVIL
 PENALTY  OF NOT LESS THAN ONE HUNDRED DOLLARS NOR MORE THAN TEN THOUSAND
 DOLLARS FOR EACH VIOLATION. IN CONNECTION WITH ANY SUCH PROPOSED  APPLI-
 CATION,  THE  ATTORNEY  GENERAL  IS  AUTHORIZED TO TAKE PROOF AND MAKE A
 DETERMINATION OF THE RELEVANT FACTS AND TO ISSUE SUBPOENAS IN ACCORDANCE
 WITH THE CIVIL PRACTICE LAW AND RULES.
   2. ANY PERSON WHO HAS BEEN THE SUBJECT OF AN ATTEMPT TO COLLECT A DEBT
 BY A DEBT COLLECTION AGENCY THAT IS NOT LICENSED PURSUANT TO THIS  ARTI-
 CLE  MAY  BRING AN ACTION IN HIS OR HER OWN NAME TO ENJOIN SUCH UNLAWFUL
 ACT OR PRACTICE, AN ACTION TO RECOVER HIS OR HER ACTUAL DAMAGES OR THREE
 THOUSAND FIVE HUNDRED  DOLLARS,  WHICHEVER  IS  GREATER,  OR  BOTH  SUCH
 ACTIONS. THE COURT MAY, IN ITS DISCRETION, INCREASE THE AWARD OF DAMAGES
 TO  AN  AMOUNT  NOT  TO  EXCEED THREE TIMES THE ACTUAL DAMAGES UP TO TEN
 THOUSAND DOLLARS, IF THE COURT FINDS THE  DEFENDANT  WILLFULLY  VIOLATED

 A. 9766                             8
 
 THIS  ARTICLE. IN THE CASE OF ANY SUCCESSFUL ACTION TO ENFORCE THE FORE-
 GOING LIABILITY, THE COURT MAY AWARD THE COSTS OF  THE  ACTION  TOGETHER
 WITH REASONABLE ATTORNEY'S FEES.
   §  604-O.  APPLICABILITY.  1. EXCEPT AS PROVIDED IN SUBDIVISION TWO OF
 THIS SECTION, THE PROVISIONS OF THIS ARTICLE  SHALL  EXCLUSIVELY  GOVERN
 THE LICENSING OF DEBT COLLECTION AGENCIES NOTWITHSTANDING THE PROVISIONS
 OF  ANY  OTHER  LAW  TO  THE CONTRARY AND FURTHER, NO LOCAL LAW SHALL BE
 ENACTED WHICH SHALL REQUIRE ANY FEE OR  LICENSE  FOR  THE  LICENSURE  OR
 REGISTRATION OF DEBT COLLECTION AGENCIES.
   2.  THE  PROVISIONS OF THIS ARTICLE SHALL NOT BE CONSTRUED TO LIMIT IN
 ANY WAY THE AUTHORITY OF A POLITICAL SUBDIVISION TO ENACT, IMPLEMENT AND
 CONTINUE TO ENFORCE LOCAL LAWS AND REGULATIONS GOVERNING  THE  LICENSURE
 OR REGISTRATION OF DEBT COLLECTION AGENCIES THAT WERE IN EFFECT PRIOR TO
 THE  EFFECTIVE  DATE OF THIS ARTICLE, OR TO ENACT, IMPLEMENT AND ENFORCE
 ANY AMENDMENTS THERETO.
   § 3. Subdivision (e) of rule 3015 of the civil practice law and rules,
 as amended by chapter 21 of the laws of 2013,  is  amended  to  read  as
 follows:
   (e)  License  to  do  business.  Where the plaintiff's cause of action
 against a consumer arises from the plaintiff's  conduct  of  a  business
 which is required by state or local law to be licensed by the department
 of  consumer affairs of the city of New York, the Suffolk county depart-
 ment of consumer affairs, the Westchester county department of  consumer
 affairs/weight-measures,  the  county  of Rockland, the county of Putnam
 [or], the Nassau county department of consumer affairs OR THE DEPARTMENT
 OF  STATE PURSUANT TO ARTICLE TWENTY-NINE-HHH OF  THE  GENERAL  BUSINESS
 LAW,  the  complaint  shall allege, as part of the cause of action, that
 plaintiff was duly licensed at the time of services rendered  and  shall
 contain  the  name  and  number, if any, of such license and the govern-
 mental agency which issued such license. The failure of the plaintiff to
 comply with this subdivision will  permit  the  defendant  to  move  for
 dismissal  pursuant  to paragraph seven of subdivision (a) of rule thir-
 ty-two hundred eleven of this chapter.
   § 4. This act shall take effect on the one hundred eightieth day after
 it shall have become a law; provided, however, that effective immediate-
 ly, the addition, amendment and/or repeal  of  any  rule  or  regulation
 necessary  for  the  implementation of this act on its effective date is
 authorized and directed to be made  and  completed  on  or  before  such
 effective date.