New York Passes Law Addressing Collection of Decedents’ Debts

insideARM's Editor's Note: This article was originally published on the Maurice Wutscher blog and is republished here with permission.

On December 28, 2018, New York Senate Bill 3491 was signed into law and will become effective March 29, 2019.  The legislation, in its final form, simply prohibits “principal creditors” and debt collection agencies from: (a) making  any  representation that a person is required to pay the debt of a family member in a way that contravenes the FDCPA; and (b) making any misrepresentation about the family member’s obligation to pay such debts.

A “principal creditor” is defined under current law as “any person, firm, corporation or organization to whom a consumer claim is owed, due or asserted to be due or owed, or any assignee for value of said person, firm, corporation or organization.”  A “debt collection agency” is newly defined in the legislation as “a person, firm or corporation engaged in business, the principal purpose of which is to regularly collect or attempt to collect debts: (a) owed or due or asserted to be owed or due to another; or (b) obtained by, or assigned to, such person, firm or corporation, that are in default when obtained or acquired by such person, firm or corporation.”

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