SUBJECT:

PURPOSE:

Federal and state law regulate how debt collectors may communicate with debtors and prohibit the use of certain threatening, deceptive and unfair collection practices. Despite these legal protections, the number of consumer complaints regarding debt collection practices continue to rise. Consumer complaints received by the Federal Trade Commission regarding third-party debt collectors grew for the eighth consecutive year in 2005, and consumers filed with the Commission more complaints against third-party collectors than against any other specific industry. The New York City Department of Consumer Affairs recently reported a seventy percent increase over the past two years in consumer complaints related to debt collection practices.

The purpose of this hearing is to determine how the State can best protect consumers against unfair and deceptive debt collection practices. The hearing will also investigate the practices of debt buyers (collection agencies that specialize in acquiring uncollected debts from principal creditors and third-party collectors) and examine the need for the State to implement enhanced consumer protections in this area.

Oral testimony will be limited to ten minute durations. Ten copies of any prepared testimony should be submitted at the hearing registration desk. The Committees would appreciate advance receipt of prepared statements. Written testimony will also be accepted and may be sent to the contact persons listed on the reply form. In order to publicize the hearing further, please inform interested parties of the Committees' interest in receiving written testimony from all sources.

In order to meet the needs of those who may have a disability, the Senate and Assembly, in accordance with their policy of non-discrimination on the basis of disability, as well as the 1990 Americans with Disabilities Act (ADA), has made its facilities and services available to all individuals with disabilities. For individuals with disabilities, accommodations will be provided, upon reasonable request, to afford such individuals access and admission to Senate and Assembly facilities and activities.

SELECTED ISSUES TO WHICH WITNESSES MAY DIRECT THEIR TESTIMONY:

1. What changes, if any, would you recommend be made to New York law to ensure that consumers are treated fairly by debt collectors?

2. Should New York State license third-party debt collectors?

3. Should New York State law be amended to provide consumers with a private right of action against debt collectors?

4. Should New York State require any person or entity seeking to collect a consumer debt to provide notice to consumers of their rights under New York's debt collection practices law with each initial correspondence regarding a past due debt, as proposed in Assembly bill 614?

5. To what extent, if any, is New York State preempted under federal law from further regulating debt collection practices?

6. To what extent has the increase in the purchasing and selling of debts led to an increase in consumer complaints related to debt collection? Should New York State regulate this sector of the debt collection industry?

7. What can New York State do to ensure that debt collectors comply with current law?

8. What actions have other states taken to protect consumers from unfair and deceptive debt collection practices?

PUBLIC HEARING REPLY FORM

Persons interested in presenting testimony at the public hearing on Debt Collection Practices to be held on October 24, 2006, or who wish to submit written testimony only, are requested to complete and return this reply form to:

Nichole Hedglin
Legislative Associate
22nd Floor, AESOB
Albany, New York 12248
Phone: (518) 455-4355
Fax: (518) 455-7250

I will address my remarks to the following subjects:

I will require assistance and/or handicapped accessibility information. Please specify the type of assistance required: