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New York Law Outlines Requirements for Collection of Decedents’ Debts


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The state law is in line with the Fair Debt Collection Practices Act and Federal Trade Commission policy.

1/9/2019 15:00

A state law outlining legal obligations of debt collectors working with the family of a deceased debtor will take effect in New York on March 29, 2019.

“No debt collection agencies shall make any representation that surviving family and household members are required to pay the outstanding debts of a deceased family member,” according to the bill passed in the state’s 2017/18 session.

The New York State Collectors Association tracked and worked on more than 100 bills during the legislative session, including the law on decedents’ debts.

According to the New York State Senate’s website, the legislation stemmed from investigations into collection from relatives of deceased debtors that may violate the Fair Debt Collection Practices Act, which “prevents collection companies from contacting anyone other than the debtor about outstanding bills.”

According to the bill text, S3491A:

  • Requires disclosure by principal creditors and debt collection agencies of the legal obligations of a deceased debtor's family and household members.
  • Amends the general business law by requiring that no principal creditors and/or debt collection agencies shall make any representation that a person is required to pay the debt of a family member in a way that contravenes with the FDCPA.
  • 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.

Eric Rosenkoetter, principal at ACA International member company Maurice Wutscher in Austin, Texas, said there were some changes on notices required in the bill before the final version passed in December 2018.

“The original version of the bill would have required both written and oral notices be given to the relatives and household members of a deceased debtor stating they ‘may not be legally required to repay deceased debtor’s debts,’” Rosenkoetter writes in a blog post on the firm’s website. “The original version would also have allowed any aggrieved person to seek injunctive relief, a civil penalty of $5,000 per violation and attorney’s fees.  Those provisions were not enacted.”

The law in New York is also consistent with the Federal Trade Commission’s policy. ACA International members may find more information on the policy and communicating with family members of a decedent through ACA SearchPoint: “FTC Final Policy Statement Regarding Collection of Decedents’ Debts.”

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