Legislation

* § 899-kkk. Registration. 1. Unless a consumer litigation funding
company has first registered with the state of New York pursuant to this
article, the company may not engage in the business of consumer
litigation funding in this state.

2. An applicant's registration must be filed in the manner prescribed
by the secretary of state and must contain all the information required
by the department of state to make an evaluation of the character and
fitness of the applicant company. The initial application must be
accompanied by a five hundred dollar fee. A renewal registration must
include a two hundred dollar fee. A registration must be renewed every
two years and expires on the thirtieth of September.

3. A certificate of registration may not be issued unless the
department of state, upon investigation, finds that the character and
fitness of the applicant company, and of the officers and directors
thereof, are such as to warrant belief that the business will be
operated honestly and fairly within the purposes of this article.

4. Every registrant shall also, at the time of filing such
application, file with the department of state, if the department of
state so requires, a bond satisfactory to the department of state in an
amount not to exceed fifty thousand dollars. In lieu of the bond at the
option of the registrant, the registrant may post an irrevocable letter
of credit. The terms of the bond must run concurrent with the period of
time during which the registration will be in effect. The bond must
provide that the registrant will faithfully conform to and abide by the
provisions of this article and to all rules lawfully made by the
administrator under this act and to any such person or persons any and
all amounts of money that may become due or owing to the state or to
such person or persons from the registrant under and by virtue of this
article during the period for which the bond is given.

5. Upon written request, the applicant shall be entitled to a hearing
on the question of the applicant's qualifications for registration if:

(a) the department of state has notified the applicant in writing that
the application has been denied, or

(b) the department of state has not issued a registration within sixty
days after the application for the registration was filed.

6. A request for a hearing may not be made more than fifteen days
after the department has mailed a written notice to the applicant that
the application has been denied and stating in substance the department
of state's findings supporting denial of the application.

7. Notwithstanding the prior approval requirement of subdivision one
of this section, a consumer litigation funding company that registered
with the department of state between the effective date of this article
or when the department of state has made applications available to the
public, whichever is later, and one hundred eighty days thereafter may
engage in consumer litigation funding while the company's registration
is pending approval with the department of state. All funding agreements
entered into prior to the effective date of this article are not subject
to the terms of this article.

8. No consumer litigation funding company may use any form of consumer
litigation funding contract in this state unless it has been filed with
the department of state in accordance with the filing procedures set
forth by the secretary of state.

9. The secretary of state is hereby authorized to adopt rules and
regulations to implement the provisions of this section as needed.

* NB Effective June 17, 2026