New York financial regulators have issued rules intended to curb abuse by debt collectors, requiring them to advise consumers when the statute of limitations has expired on debts and confirm settlement agreements in writing.
Regulations by the Department of Financial Services, first proposed in 2013, also authorize consumers to choose email for communications from collectors and request verification of disputed debts.
New Yorkers filed more than 20,000 complaints about collection practices this year, including harassing calls, contacting incorrect people and seeking incorrect amounts, especially with defaulted debts bought for pennies on the dollar.
Federal law prohibits collectors from using or threatening violence, using obscenities or profanities and calling repeatedly intending to harass debtors.
Money exempt from judgments includes Social Security, pensions, welfare, disability benefits, veterans' benefits, alimony and child support.
The State Attorney General provides the following information that shows what a debt collection agency is prohibited from doing:
Debt collection agencies are prohibited from engaging in the following harassing or abusive practices:
- using or threatening to use violence or criminal means to harm you;
- using obscene or profane language;
- advertising your debt for sale;
- telephoning you repeatedly or continuously with the intent to annoy or harass; or
- placing telephone calls without meaningful disclosures of their identity.
False or Misleading Representations: Debt collection agencies are prohibited from:
- making false representations that they are government representatives;
- making false representations that they will seize, garnish or sell any property or wages unless such action is lawful;
- making false representations that you have committed a crime or that you will be arrested or imprisoned;
- making false representations that papers resembling official documents are from a court or governmental agency, when they are not;
- making false representations about the amount of the debt;
- making false representations that the debt collector is employed by a credit bureau;
- making false representations that they are attorneys or that there is the involvement of an attorney in collecting a debt;
- making threats to communicate false credit information with any other person; or
- using a false business name.
Other Prohibited Practices: Debt collection agencies are prohibited from:
- collecting an amount greater than what you owe;
- depositing a post-dated check prior to the date on the check;
- contacting you by postcard;
- threatening to take possession of your property through non-judicial action, when there is no right to do so.