S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  3041--A
 
                        2021-2022 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             January 22, 2021
                                ___________
 
 Introduced  by  M. of A. GUNTHER, SEAWRIGHT -- read once and referred to
   the  Committee  on  Consumer  Affairs  and  Protection  --   committee
   discharged, bill amended, ordered reprinted as amended and recommitted
   to said committee
 
 AN ACT to amend the banking law and the civil practice law and rules, in
   relation to licensed consumer debt collectors
 
   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
 presence   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
 threatening,    deceptive   and   unfair collection   practices. Despite
 these  legal  protections,  there  continue  to  be  frequent   consumer
 complaints  regarding  debt  collection  practices. Due to the sensitive
 nature of the information used in the course of  debt  collection  agen-
 cies' work, and the vulnerable position consumers may find themselves in
 when  dealing with these agencies, it is incumbent upon this legislature
 to ensure that agencies that engage in unscrupulous or abusive practices
 shall not continue to operate in this state. To protect  the  interests,
 reputations,  and  financial  wellbeing  of residents of this state from
 unwarranted harm, the legislature hereby declares that the state  should
 not  permit  debt  collection agencies to operate without a license from
 the state.
   § 2. The banking law is amended by adding a new article 7 to  read  as
 follows:
                                 ARTICLE 7
                     LICENSED CONSUMER DEBT COLLECTORS
 SECTION 295. DEFINITIONS.
         296. DEBT COLLECTION AGENCIES.
         297. SURETY BONDING REQUIREMENT.

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

                                                            LBD02792-04-1

 A. 3041--A                          2
 
         298. PENALTIES.
         299. EXAMINATIONS.
         300. APPLICABILITY.
   § 295. 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 SUPERINTENDENT;
   (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

 A. 3041--A                          3
 
 ENFORCED  FOR  CHILD  SUPPORT,  SPOUSAL SUPPORT, MAINTENANCE OR ALIMONY,
 SUCH PERSON MUST COMPLY WITH THE REQUIREMENTS OF THIS ARTICLE.
   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.
   § 296. DEBT COLLECTION AGENCIES. 1. ON OR AFTER MAY FIRST,  TWO  THOU-
 SAND TWENTY-TWO, NO PERSON SHALL ACT AS A DEBT COLLECTION AGENCY WITHOUT
 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
 ONE  YEAR  UNLESS  SOONER SUSPENDED OR REVOKED. THE SUPERINTENDENT SHALL
 ESTABLISH BY REGULATION THE EXPIRATION DATE OF SUCH LICENSES.
   (B) THE FEE FOR A LICENSE OR RENEWAL THEREOF SHALL  BE  AS  PRESCRIBED
 PURSUANT TO SECTION EIGHTEEN-A OF THIS CHAPTER.
   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
 SUPERINTENDENT MAY PRESCRIBE AND SHALL PAY  THE  FEE  REQUIRED  BY  THIS
 SECTION.
   (B)  IN ADDITION TO ANY OTHER INFORMATION REQUIRED, THE SUPERINTENDENT
 SHALL REQUIRE, BUT NOT BE LIMITED TO,  THE  FOLLOWING  INFORMATION,  AND
 SHALL,  AS  APPROPRIATE, REQUIRE SUCH INFORMATION NOT ONLY OF THE APPLI-
 CANT BUT ALSO OF ANY OF ITS PRINCIPALS, PARTNERS,  OFFICERS  AND  DIREC-
 TORS,  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. 3041--A                          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 SUPERINTENDENT WITH A SUMMARY OF  THE  APPLI-
 CANT'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
 SUPERINTENDENT AS HIS OR HER AGENT UPON WHOM PROCESS OR OTHER  NOTIFICA-
 TION MAY BE SERVED.
   4.  IN  DETERMINING  WHETHER TO ISSUE, RENEW OR SUSPEND A LICENSE, THE
 SUPERINTENDENT SHALL CONSIDER THE CHARACTER, COMPETENCY AND INTEGRITY OF
 THE APPLICANT. THE SUPERINTENDENT 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 THE GENERAL BUSINESS LAW OR  FAILED
 TO  PAY  ANY  FINAL CIVIL JUDGMENT RELATING TO WORK AS A DEBT COLLECTION
 AGENCY, IF SUCH REFUSAL, IN THE JUDGMENT  OF  THE  SUPERINTENDENT,  BEST
 PROMOTES THE INTERESTS OF THE PEOPLE OF THIS STATE; OR
   (B)  VIOLATED  ARTICLE  TWENTY-NINE-H OF THE GENERAL BUSINESS LAW, THE
 FEDERAL FAIR DEBT COLLECTION PRACTICES ACT (15 USC § 1692 ET  SEQ.),  OR
 ANY PROVISION OF THIS ARTICLE.
   ALL  DETERMINATIONS  BY THE SUPERINTENDENT 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
 DETERMINED PURSUANT TO SECTION EIGHTEEN-A OF THIS CHAPTER.
   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.

 A. 3041--A                          5
 
   10. THE SUPERINTENDENT SHALL  ISSUE  EACH  DEBT  COLLECTION  AGENCY  A
 UNIQUE LICENSE NUMBER.
   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 SUPERINTENDENT 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  SUPERINTENDENT,  NOT  IN
 LIMITATION  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 SUPERINTENDENT, SUCH INVESTIGATION OR EXAMINATION IS WARRANTED. EACH
 DEBT  COLLECTION  AGENCY SHALL BE OBLIGED, ON REQUEST OF THE SUPERINTEN-
 DENT, 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 SUPERINTENDENT 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 SUPERINTENDENT 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 SUPERINTENDENT MAY DESIGNATE, WHO  SHALL
 HAVE  THE  POWER  TO SUBPOENA AND BRING BEFORE THE OFFICER, OR PERSON SO
 DESIGNATED, 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

 A. 3041--A                          6
 
 TO  TAKE  SUCH  TESTIMONY  SHALL NOT BE BOUND BY COMMON LAW OR STATUTORY
 RULES OF EVIDENCE OR BY TECHNICAL OR FORMAL RULES OF PROCEDURE.
   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 SUPERINTENDENT
 MAY DESIGNATE, SHALL HAVE THE POWER TO SUSPEND THE LICENSE OF ANY LICEN-
 SEE 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.
   § 297. 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 TWENTY-FIVE  THOUSAND  DOLLARS  TO  BE
 FILED WITH THE SUPERINTENDENT.
   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-SEVEN  THOUSAND  FIVE HUNDRED DOLLARS TO BE FILED WITH THE SUPER-
 INTENDENT.

 A. 3041--A                          7
 
   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
 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-SIX THOUSAND TWO HUNDRED DOLLARS TO BE FILED WITH THE  SUPERINTEN-
 DENT.
   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 SUPERINTENDENT.
   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 THE GENER-
 AL BUSINESS LAW AND PAY ALL CIVIL PENALTIES, FINES, OR OTHER OBLIGATIONS
 IMPOSED  BY  THE  SUPERINTENDENT  OR A COURT OF LAW, INVESTIGATORY COSTS
 REQUIRED TO BE PAID, OR ANY FINAL JUDGMENT AGAINST THE LICENSEE PURSUANT
 TO SUCH ARTICLES.
   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 SUPERINTENDENT
 PRIOR TO THE EFFECTIVE DATE OF CANCELLATION OF THE BOND. THE FAILURE  TO
 MAINTAIN  SUCH  A  BOND  SHALL OPERATE TO REVOKE THE LICENSE OF THE DEBT
 COLLECTION AGENCY UPON NOTICE AND HEARING.
   § 298. 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

 A. 3041--A                          8
 
 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
 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.
   § 299. EXAMINATIONS. 1. EACH LICENSED  DEBT  COLLECTION  AGENCY  SHALL
 KEEP  AND  USE IN ITS BUSINESS SUCH BOOKS, ACCOUNTS, AND RECORDS AS WILL
 ENABLE THE SUPERINTENDENT TO DETERMINE WHETHER SUCH LICENSEE IS  COMPLY-
 ING  WITH  THE  PROVISIONS  OF THIS ARTICLE AND WITH THE RULES AND REGU-
 LATIONS PROMULGATED HEREUNDER. EVERY  LICENSED  DEBT  COLLECTION  AGENCY
 SHALL  PRESERVE  SUCH  BOOKS,  ACCOUNTS,  AND RECORDS, FOR AT LEAST FIVE
 YEARS AFTER MAKING THE FINAL ENTRY REGARDING A CONSUMER DEBT.  PRESERVA-
 TION  OF  PHOTOGRAPHIC  REPRODUCTION  THEREOF OR RECORDS IN PHOTOGRAPHIC
 FORM, INCLUDING AN OPTICAL DISK STORAGE SYSTEM AND THE USE OF ELECTRONIC
 DATA PROCESSING EQUIPMENT THAT  PROVIDES  COMPARABLE  RECORDS  TO  THOSE
 OTHERWISE  REQUIRED AND WHICH ARE AVAILABLE FOR EXAMINATION UPON REQUEST
 SHALL CONSTITUTE COMPLIANCE WITH THE REQUIREMENTS OF THIS SECTION.
   2. EACH LICENSED DEBT COLLECTION AGENCY SHALL ANNUALLY, ON  OR  BEFORE
 APRIL  FIRST, FILE A REPORT WITH THE SUPERINTENDENT GIVING SUCH INFORMA-
 TION AS THE SUPERINTENDENT MAY REQUIRE CONCERNING THE BUSINESS AND OPER-
 ATIONS DURING THE PRECEDING CALENDAR YEAR  OF  EACH  LICENSED  PLACE  OF
 BUSINESS  CONDUCTED  BY  SUCH LICENSED DEBT COLLECTION AGENCY WITHIN THE
 STATE UNDER AUTHORITY OF THIS ARTICLE. SUCH REPORT SHALL  BE  SUBSCRIBED
 AND  AFFIRMED  AS  TRUE BY THE LICENSED DEBT COLLECTION AGENCY UNDER THE
 PENALTIES OF PERJURY AND SHALL BE IN THE FORM PRESCRIBED BY  THE  SUPER-
 INTENDENT.
   3.  IN ADDITION TO ANNUAL REPORTS, THE SUPERINTENDENT MAY REQUIRE SUCH
 ADDITIONAL REGULAR OR SPECIAL REPORTS AS MAY BE DEEMED NECESSARY TO  THE
 PROPER SUPERVISION OF A LICENSED DEBT COLLECTION AGENCY UNDER THIS ARTI-
 CLE.    SUCH  ADDITIONAL  REPORTS SHALL BE IN THE FORM PRESCRIBED BY THE
 SUPERINTENDENT AND SHALL BE SUBSCRIBED AND AFFIRMED AS  TRUE  UNDER  THE
 PENALTIES OF PERJURY.
   4. THE EXPENSES OF EVERY EXAMINATION OF THE AFFAIRS OF A LICENSED DEBT
 COLLECTION AGENCY SUBJECT TO THIS SECTION SHALL BE BORNE AND PAID BY THE
 LICENSED DEBT COLLECTION AGENCY.
   § 300. 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 693 of the laws of 2019, 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-

 A. 3041--A                          9
 
 ment of consumer affairs, the county of Rockland, the county of  Putnam,
 the county of Westchester, [or] the Nassau county department of consumer
 affairs  OR  THE  DEPARTMENT  OF  FINANCIAL SERVICES PURSUANT TO ARTICLE
 SEVEN  OF  THE  BANKING  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 governmental agency which issued such license. The fail-
 ure  of  the  plaintiff  to comply with this subdivision will permit the
 defendant to move for dismissal pursuant to paragraph seven of  subdivi-
 sion (a) of rule thirty-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.  Effective immediately, the addition, amend-
 ment and/or repeal of any rule or regulation necessary for the implemen-
 tation  of  this act on its effective date are authorized to be made and
 completed on or before such effective date.