The New York State Department of Financial Services latest regulatory agenda confirms that it is still considering a rulemaking to amend debt collection regulations to better protect consumers and to bring regulations in line with the federal Regulation F.
02/02/2024 2:15 P.M.
2 minute read
The New York State Regulatory Agenda (PDF) published earlier this week included possible rulemaking activity from the Department of Financial Services’ (NYDFS) regarding the regulations for third party collection agencies and debt buyers. This possible action is a continuation of a multiyear rulemaking in this area that the department allowed to expire in 2023.
ACA International has highlighted industry concerns to the NYDFS by submitting comments on previous proposals and expected this issue would remain on their regulatory agenda.
ACA and the New York State Collectors Association (NYSCA) met with the department and submitted comments during the now expired rulemaking and will continue to advocate for industry priorities if the department decides to move forward and introduce a new proposal in this area.
During the previous rulemaking, ACA and the NYSCA urged the department to slow down and allow Regulation F to take effect and to ensure all provisions in the proposal were in line with the soon to be signed New York Consumer Credit Fairness Act as well as existing federal law.
The regulatory agenda stated that proposal currently being contemplated would “update the regulation in relation to revised federal rules promulgated pursuant to the Fair Debt Collection Practices Act and recently enacted state legislation relating to debt collection and causes of action arising from consumer credit transactions.”
It also states it would respond to “changes in communication technology used by the debt collection industry to reach consumers” and enhances “the department’s ability to protect consumers from abusive debt collection practices.”
The NYFDS is not required to act on the proposal based upon its publication in the regulatory agenda. ACA will provide updates to members on any action or a proposed timeline for updated debt collection proposals.
Meanwhile, the New York City Department of Consumer and Worker Protection is also reviewing proposed debt collection rules.
The department held a hearing for stakeholder comments in November 2023 where the accounts receivable management industry was again well represented by a coalition of advocates from ACA and NYSCA, as well as the Receivables Management Association International and New York State Creditors Bar.
The proposed rules in New York City would substantially expand current record retention and reporting requirements for collection agencies and would revise validation and verification procedures. Additionally, the proposal would require debt collectors to inform consumers about language access services, ACA previously reported.
The proposed amendments to the rules would strengthen consumer disclosures and update requirements for reports licensed agencies must submit to the department, among other changes.
For more state updates, members are invited to register and join the weekly ACA Huddle at 11 a.m. CDT on Wednesdays.
Plus: Don’t miss ACA’s State Guide Cohort monthly webinar series for updates into state collection laws and practices. The next webinar is at 1 p.m. CST Feb. 13.