S1822A-2011 Actions

• Jan 5, 2012: PRINT NUMBER 1822A
• Jan 5, 2012: AMEND AND RECOMMIT TO CONSUMER PROTECTION
• Jan 4, 2012: REFERRED TO CONSUMER PROTECTION
• Jan 13, 2011: REFERRED TO CONSUMER PROTECTION

S1822A-2011 Memo

BILL NUMBER:S1822A

TITLE OF BILL:
An act
to amend the general business law, in relation to
debt collection procedures

PURPOSE:
This bill would enact into New York State law protections against
improper and abusive consumer debt collection practices, and provide
for a private right of action for consumers injured by such practices.

SUMMARY OF PROVISIONS:
Section 1 of the bill amends Article 29-H of the General Business Law
(GBL), Debt Collection Procedures to do the following:

* Amend GBL � 600 to revise the definitions of "consumer debt,"
"debtor," and "creditor," and to define "consumer," "communication,"
"debt collector," "location information," and "verification of the
debt."

* Amend GBL � 601 to make it a prohibited practice for creditors to
communicate with the debtor or his family or household except between
8:00 A.M. and 9:00 P.M.

* Renumber GBL � 602 (violations and penalties) as � 606, and create a
new �602 to require creditors to send notice to the last known
address of a debtor when his or her debt is sold or transferred, and
to provide purchasers of a debt with a consumer's written
notification that he or she disputes the debt.

* Renumber GBL � 603 (severability) as � 607 and create a new GBL � 603
to delineate certain prohibited practices by a debt collector,
including among others: (1) acquiring location information regarding
a consumer without properly identifying him or herself; (2)
communicating with a consumer at inconvenient times or with excessive
frequency; (3) communicating directly with a consumer known to be
represented by counsel; (4) communicating with a consumer who had
notified the collector of his or her refusal to pay, except for
certain limited purposes; (5) engaging in harassment or abuse; (6)
making false or misleading representations; (7) collecting an amount
not expressly authorized by the agreement creating the debt; (8)
soliciting a post-dated instrument for the purpose of threatening or
instituting criminal prosecution; (9) causing charges to
be made to any person for communications by misrepresenting the true
purpose of the communications; (10) communicating with a consumer
about a debt by postcard; (11) communicating with a consumer about a
debt, after instituting debt collection procedures, without
identifying him or herself; and (12) designing, compiling or
furnishing a form with knowledge that it would create the false
belief in a consumer that a person other than the creditor is
participating in the collection. This section also sets forth
appropriate procedures for the validation of debts by debt collectors.

* Add a new GBL � 603-a to require debt purchasers and their agents to
send notice to the last known address of a debtor that his or her
debt is being sold or transferred, and to provide purchasers of a


debt, and debt collectors, with a consumer's written notification
that he or she disputes the debt.

* Add a new GBL � 603-b to provide for a private right of action to
recover two thousand five hundred dollars and actual damages for a
violation of this article. This section also provides that a debt
collector may not be held liable in any action brought under this
article if the debt collector shows by a preponderance of evidence
that the violation was not intentional and resulted from a bona fide
error notwithstanding the maintenance of procedures reasonably
adapted to avoid any such error.

Section 2 of the bill provides that it would become effective on the
succeeding January 1 after it becomes law except that GBL �� 602,
603(7) and 503-a shall apply only to debts incurred on or after the
effective date of such sections.

EXISTING LAW:
General Business Law Article 29-H prohibits certain practices in
regard to debt collection. Among other requirements, the Article bars
a principal creditor, which is defined to include both a principal
first issuer of credit, and any debt collector that is assigned the
debt from a principal creditor, from: (1) simulating a law
enforcement officer, or a representative of any governmental agency
of the state of New York or any of its political subdivisions; (2)
knowingly collecting attempting to collect, or asserting a right to
any collection fee, attorney's fee, court cost or expense unless
legally chargeable against the debtor; (3) disclosing or threatening
to disclose information affecting the debtor's reputation for
creditworthiness with knowledge or reason to know that the
information is false; (4) communicating or threatening to communicate
the nature of a consumer claim to the debtor's employer prior to
obtaining final judgment against the debtor; (5) disclosing or
threatening to disclose information concerning the existence of a
debt known to be disputed by the debtor without disclosing that fact;
(6) communicating with a debtor or any member of his family or
household with such frequency or at such unusual hours or in such
a manner as can reasonably be expected to abuse or harass the debtor;
or (7) threatening any action which the principal creditor in the
usual course of his business does not in fact take; (8) claiming,
attempting or threatening to enforce a right with knowledge or reason
to know that the right does not exist; or (9) using a communication
which simulates in any manner legal or judicial process or which
gives the appearance of being authorized, issued
or approved by a government, governmental agency, or attorney at law
when it is not.

LEGISLATIVE HISTORY:
This is a new proposal.

STATEMENT IN SUPPORT:
Many consumers today are finding themselves the subjects of debt
collection proceedings. Creditors and debt collectors in pursuit of
collection, often fail to inform the consumers of the important
details related to the debt, such as where the debt originated, or
the name and address of the original creditor. This creates a
frustrating process for a debtor who has disputes with all ,or part


of the claimed debt. An exacerbating factor during this process is
that consumers, who are struggling and faced with the inability to
payoff a loan or credit card bill, often are subjected to persistent
and sometimes abusive debt collection tactics.

In the past four years, the CPB has received approximately 3,894 debt
collection complaints and/or inquiries. This bill would provide
consumers with adequate recourse to address the improper practices
cited in those complaints, while still allowing businesses to collect
upon the debts owed to them.

The debt collection industry has changed significantly in the more
than three decades since Article 29-H of the General Business Law was
enacted in 1973, and the federal Fair Debt Collection Practices Act
(FDCPA) was enacted in 1977. It was recently noted in a Federal Trade
Commission (FTC) report that, "The most significant change in the
debt collection business in the past decade, however, has been the
advent and growth of debt buying (Le. the purchasing, collecting and
reselling of debts in default). It The report furthers that the FDCPA
should be amended to reflect the advent and expansion of debt buying
industry, and require debt collectors to have and convey to consumers
more information in validation notices. To address this concern, the
FTC recommends that the FDCPA be amended to require that debt
collectors obtain and provide in the "validation notices" they send
to consumers: (1) the name of the original creditor; and (2) an
itemization of (a) the principle, (b) the total Of all interest, and
(c) the total of all fees and charges that make up the debt."(1)

This bill would address these problems by incorporating into New York
law many aspects of the FDCPA. It would add to the terms of that Act
the requirement that debt collectors provide verification of a
consumers debt upon request, and also notice to consumers when their
debt is sold. This would allow consumers to determine the source
and legitimacy of debt collection notices they receive from third
parties with whom they have not had prior contact.

The current outdated laws regulating the debt collection industry,
combined with the unprecedented increase in consumer debt has created
a perfect storm for consumers. The latest United States statistics
indicated the total amount of consumer debt, which does not include
any debt
secured by real estate, is nearly $2.6 trillion dollars.(2) When
extrapolated, this works out to be nearly $8,500 in debt for every
man, woman and child that lives in the United States.(3)

The tragic impact of this debt load was exemplified recently in the
NBC Dateline story, The Debt Trap, which embodied the many scenarios
faced by consumers who have become ensnared in debt collection
proceedings, including those consumers who never incurred or owed
such debt. It also depicted the abuse and harassment tactics some
debt collectors employ against consumers to collect debts. It most
importantly provided the landscape and desperation of consumers
struggling today to pay their debts while facing or experiencing
layoffs, mortgage foreclosures, and severely decreased investment
assets.


In addition, a recent New York Times article (4) featured the rapidly
increasing trend of creditors and banking institutions using the
State's civil court system as a debtors' court, with its lure of a
quick and often easy opportunity to obtain default judgments in their
collection efforts. The article explains that lawsuit filings
involving debt collections have nearly tripled since 2000. Court
officials project that of those filings, 350,000 in the New York City
Civil Court this year alone will involve debt on credit cards. This
increased activity, combined with the reality of financially strapped
consumers struggling to meet their basic needs, creates a perfect
storm for greater economic turmoil.

Consumers need recourse against nefarious debt collection practices,
and deter unsubstantiated debt collection lawsuits. Thus, the statute
would also provide consumers with a private right of action to
enforce the terms of this statute, and the right to recover damages
of $2500 per wrongful act. The FDCPA provides for only $1000 per
violation, but such damages have not been revised to reflect
inflation since the FDCPA was first enacted in 1977. This bill would
provide consumers with a remedy under New York law that reflects such
change, and that provides an adequate deterrent to misconduct. Like
the FDCPA, this bill would allow a prevailing plaintiff to recover
attorneys' fees.

By largely aligning New York and federal law, this bill would provide
a consistent set of rules for debt collectors to follow, while giving
consumers adequate remedies for stopping abusive practices.

BUDGET IMPLICATIONS:
None.

EFFECTIVE DATE:
This bill would become effective on the first of January next
succeeding the date on which it shall have become a law, except that
GBL �� 602, 603(7) and 603-a shall apply only to debts incurred on or
after the effective date of such sections.

FOOTNOTES:

(1) Collecting Consumer Debts: The Challenges of Change, FTC Workshop
Report, pages iv-v, (February 2009).

(2) Consumer Credit Statistics, Federal Reserve Board (May 7, 2009).

(3) Consumer Debt Statistics, Money-zine.com. (May 2009).

(4) In Civil Court, One Nation, Under Debt, New York Times, (October
11, 2008).

S1822A-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

                                   1822--A

                         2011-2012 Regular Sessions

                              I N  SENATE

                              January 13, 2011
                                 ___________

  Introduced  by  Sen. PERKINS -- read twice and ordered printed, and when
    printed to be committed to the Committee  on  Consumer  Protection  --
    recommitted to the Committee on Consumer Protection in accordance with
    Senate  Rule  6, sec. 8 -- committee discharged, bill amended, ordered
    reprinted as amended and recommitted to said committee

  AN ACT to amend the general business law, in relation to debt collection
    procedures

    THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section 1. Article 29-H of the general business law, as added by chap-
  ter 753 of the laws of 1973, subdivision 9 of section 601 as amended and
  subdivision  10 of section 601 and subdivision 3 of section 602 as added
  by chapter 342 of the laws of 2011, is amended to read as follows:

                                ARTICLE 29-H
                         DEBT COLLECTION PROCEDURES
  Section 600. Definitions.
          601. Prohibited CREDITOR practices.
          602. [Violations and penalties] CREDITOR RESPONSIBILITIES.
          603. [Severability] PROHIBITED DEBT COLLECTION PRACTICES.
          603-A. SELLING OR TRANSFERRING OF DEBTS.
          603-B. PRIVATE RIGHT OF ACTION.
          603-C. VIOLATIONS AND PENALTIES.
          603-D. SEVERABILITY.
    S 600. Definitions. As used in this article,  unless  the  context  or
  subject  matter  otherwise  requires:  1.  "[Consumer  claim]  DEBT"  OR
  "CONSUMER DEBT" means any obligation OR ALLEGED OBLIGATION of a  natural
  person  for  the  payment  of  money  [or  its equivalent which is or is
  alleged to be in default and which arises] ARISING  out  of  a  CONSUMER
  transaction  wherein  credit  has  been offered or extended to a natural
  person, and the money, property [or],  INSURANCE,  service  OR  SERVICES
  which  [was]  ARE the subject of the transaction [was] ARE primarily for

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD07289-02-2

 S. 1822--A                          2

  personal, family or household purposes, WHETHER OR NOT  SUCH  OBLIGATION
  HAS  BEEN  REDUCED  TO A JUDGMENT.  The term includes an obligation of a
  natural person who is a co-maker, endorser, guarantor or surety as  well
  as the natural person to whom such credit was originally extended.
    2.  "Debtor"  means  any natural person who owes or who is asserted to
  owe a [consumer claim] CONSUMER DEBT.
    3. "[Principal creditor] CREDITOR" means  any  person,  firm,  ASSOCI-
  ATION, corporation, [or] organization [to whom] OR OTHER BUSINESS ENTITY
  THAT OFFERS OR EXTENDS CREDIT, CREATING a consumer [claim is] DEBT owed,
  due  or  asserted  to be due or owed, [or any assignee for value of said
  person, firm, corporation  or  organization]  BUT  SUCH  TERM  DOES  NOT
  INCLUDE  ANY  PERSON,  ASSOCIATION,  FIRM,  CORPORATION, ORGANIZATION OR
  OTHER BUSINESS ENTITY TO THE EXTENT THAT IT RECEIVES  AN  ASSIGNMENT  OR
  TRANSFER  OF  A  DEBT  IN DEFAULT SOLELY FOR THE PURPOSE OF FACILITATING
  COLLECTION OF SUCH DEBT FOR ANOTHER.
    4. "COMMUNICATION" MEANS THE CONVEYING OF INFORMATION REGARDING A DEBT
  DIRECTLY OR INDIRECTLY TO ANY PERSON THROUGH ANY MEDIUM.
    5. "CONSUMER" MEANS ANY NATURAL PERSON OBLIGATED  OR  ALLEGEDLY  OBLI-
  GATED  TO  PAY ANY DEBT ARISING OUT OF A TRANSACTION IN WHICH THE MONEY,
  PROPERTY, INSURANCE, OR SERVICES WHICH ARE THE  SUBJECT  OF  THE  TRANS-
  ACTION ARE PRIMARILY FOR PERSONAL, FAMILY, OR HOUSEHOLD PURPOSES, WHETH-
  ER OR NOT SUCH OBLIGATION HAS BEEN REDUCED TO JUDGMENT.
    6.  "DEBT  COLLECTOR"  MEANS  AN INDIVIDUAL, ASSOCIATION, FIRM, CORPO-
  RATION, ORGANIZATION OR OTHER BUSINESS ENTITY WHO, AS PART OF HIS OR HER
  JOB, REGULARLY COLLECTS OR SEEKS TO COLLECT FROM A CONSUMER A DEBT  OWED
  OR DUE TO ANOTHER OR ALLEGED TO BE OWED OR DUE.
    THE TERM DOES NOT INCLUDE:

    (A)  ANY  OFFICER  OR EMPLOYEE OF A CREDITOR WHILE, IN THE NAME OF THE
  CREDITOR, COLLECTING DEBTS FOR SUCH CREDITOR;
    (B) ANY OFFICER OR EMPLOYEE OF THE UNITED STATES,  ANY  STATE  OR  ANY
  POLITICAL  SUBDIVISION  OF  ANY  STATE  TO THE EXTENT THAT COLLECTING OR
  ATTEMPTING TO COLLECT ANY DEBT OWED IS IN THE PERFORMANCE OF HIS OR  HER
  OFFICIAL DUTIES;
    (C)  ANY  PERSON WHILE SERVING OR ATTEMPTING TO SERVE LEGAL PROCESS ON
  ANY OTHER PERSON IN CONNECTION WITH  THE  JUDICIAL  ENFORCEMENT  OF  ANY
  DEBT;
    (D)  ANY INDIVIDUAL EMPLOYED BY A NONPROFIT ORGANIZATION WHICH, AT THE
  REQUEST OF CONSUMERS, PERFORMS BONA FIDE CONSUMER CREDIT COUNSELING  AND
  ASSISTS  CONSUMERS  IN  THE  LIQUIDATION  OF  THEIR  DEBTS  BY RECEIVING
  PAYMENTS FROM SUCH CONSUMERS AND DISTRIBUTING SUCH AMOUNTS TO CREDITORS;
    (E) ANY PERSON WHILE ACTING AS A DEBT COLLECTOR  FOR  ANOTHER  PERSON,
  BOTH  OF WHOM ARE RELATED BY COMMON OWNERSHIP OR AFFILIATED BY CORPORATE
  CONTROL, IF THE PERSON ACTING AS A  DEBT  COLLECTOR  DOES  SO  ONLY  FOR
  PERSONS  WHOM  IT SO RELATED OR AFFILIATED AND IF THE PRINCIPAL BUSINESS
  OF SUCH PERSON IS NOT THE COLLECTION OF DEBTS; OR
    (F) ANY PERSON COLLECTING OR ATTEMPTING TO COLLECT ANY  DEBT  OWED  OR
  DUE  OR  ASSERTED  TO BE OWED OR DUE ANOTHER TO THE EXTENT SUCH ACTIVITY
  (I) IS INCIDENTAL TO A BONA FIDE FIDUCIARY OBLIGATION  OR  A  BONA  FIDE
  ESCROW  ARRANGEMENT;  (II)  CONCERNS A DEBT WHICH WAS ORIGINATED BY SUCH
  PERSON; (III) CONCERNS A DEBT WHICH WAS NOT IN DEFAULT AT  THE  TIME  IT
  WAS  OBTAINED  BY  SUCH PERSON; OR (IV) CONCERNS A DEBT OBTAINED BY SUCH
  PERSON'S SECURED PARTY IN A COMMERCIAL CREDIT TRANSACTION INVOLVING  THE
  CREDITOR.
    7. "LOCATION INFORMATION" MEANS A CONSUMER'S PLACE OF ABODE AND HIS OR
  HER TELEPHONE NUMBER AT SUCH PLACE, OR HIS OR HER PLACE OF EMPLOYMENT.

 S. 1822--A                          3

    8.  "VERIFICATION OF THE DEBT" MEANS A COPY OF THE LAST BILL OR NOTICE
  OF COLLECTION SENT FROM THE CREDITOR TO THE DEBTOR, ANY JUDGMENT  LEVIED
  IN  CONJUNCTION  WITH SUCH DEBT, AND, IF APPLICABLE, A COPY OF THE JUDG-
  MENT RELEASE AND A COPY OF THE WRITTEN COMMUNICATION ADVISING THE DEBTOR
  THAT HIS OR HER DEBT HAS BEEN SOLD OR TRANSFERRED.
    S  601.  Prohibited  CREDITOR  practices.  No [principal] creditor, as
  defined by this article, or his OR HER agent shall:

    1. Simulate in any manner a law enforcement officer,  or  a  represen-
  tative of any governmental agency of the state of New York or any of its
  political subdivisions; or
    2.  Knowingly  collect,  attempt  to collect, or assert a right to any
  collection fee, attorney's  fee,  court  cost  or  expense  unless  such
  [changes]  CHARGES  are  justly  due  and legally chargeable against the
  debtor; or
    3. Disclose or threaten to disclose information affecting the debtor's
  reputation for credit worthiness with knowledge or reason to  know  that
  the information is false; or
    4.  Communicate  or  threaten  to communicate the nature of a consumer
  [claim] DEBT to the debtor's employer prior to obtaining final  judgment
  against  the  debtor.    The  provisions  of  this subdivision shall not
  prohibit a [principal] creditor from  communicating  with  the  debtor's
  employer  to  execute  a  wage  assignment  agreement  if the debtor has
  consented to such an agreement; or
    5. Disclose or threaten to disclose information concerning the  exist-
  ence  of  a  debt  known to be disputed by the debtor without disclosing
  that fact; or
    6. Communicate with the debtor or any member of his OR HER  family  or
  household AT ANY TIME OTHER THAN BETWEEN THE HOURS OF 8:00 A.M. AND 9:00
  P.M.  LOCAL TIME OR with such frequency [or at such unusual hours] or in
  such a manner as can reasonably be  expected  to  abuse  or  harass  the
  debtor; or
    7.  Threaten  any  action  which the [principal] creditor in the usual
  course of his OR HER business does not in fact take; or
    8. Claim, or attempt or threaten to enforce a right with knowledge  or
  reason to know that the right does not exist; or
    9. Use a communication which simulates in any manner legal or judicial
  process  or  which  gives  the appearance of being authorized, issued or
  approved by a government, governmental agency, or attorney at  law  when
  it is not; or
    10. If such [principal] creditor or agent sends more than fifty infor-
  mation subpoenas per month, fail to keep complete records concerning all
  information  subpoenas  sent by such [principal] creditor or agent. Such
  records shall be maintained  for  five  years.  Contemporaneous  records
  shall  be  kept  that  set  forth  with specificity the grounds for such
  [principal] creditor or agent's reasonable belief, which must be  certi-
  fied  and accompany each information subpoena pursuant to rule fifty-two
  hundred twenty-four of the civil practice law and rules, that the  party
  receiving  the  subpoena  has  in  its  possession information about the
  debtor that will assist the creditor in collecting his or her judgement.
  In addition to any other penalty that [my] MAY be  imposed,  failure  to
  maintain  records in accordance with this subdivision shall subject such
  [principal] creditor or agent to a civil penalty of not more than  fifty
  dollars  per  subpoena,  up  to  a  maximum of five thousand dollars per
  violation, in an action brought by the attorney general.
    S 602. CREDITOR RESPONSIBILITIES.  EVERY CREDITOR OR HIS OR HER  AGENT
  SHALL SEND A NOTICE TO THE LAST KNOWN ADDRESS OF THE DEBTOR ADVISING THE

 S. 1822--A                          4

  DEBTOR  WHEN  HIS  OR HER DEBT IS BEING SOLD OR TRANSFERRED, PRIOR TO OR
  CONTEMPORANEOUS WITH THE SALE OF THE DEBT. A COPY OF THIS  NOTICE  SHALL
  BE  TRANSMITTED  TO THE PERSON, FIRM, ORGANIZATION OR ENTITY TO WHOM THE
  CREDITOR  OR  HIS  OR HER AGENT HAS AGREED TO SELL OR TRANSFER THE DEBT,
  ALONG WITH A COPY OF ANY NOTICE IN REGARD TO THE DEBT  PROVIDED  TO  THE
  CREDITOR  IN  ACCORDANCE  WITH  PARAGRAPH  (B)  OF  SUBDIVISION SEVEN OF
  SECTION SIX HUNDRED THREE OF THIS ARTICLE. A CREDITOR  SHALL  PROVIDE  A
  COPY OF SUCH NOTICE TO ANY DEBT COLLECTOR HIRED TO COLLECT SUCH DEBT.
    S  603. PROHIBITED DEBT COLLECTION PRACTICES.  IT IS AN UNCONSCIONABLE
  AND DECEPTIVE TRADE PRACTICE FOR A DEBT COLLECTOR TO ATTEMPT TO  COLLECT
  A  DEBT  OWED,  DUE,  OR ASSERTED TO BE OWED OR DUE EXCEPT IN ACCORDANCE
  WITH THE FOLLOWING:

    1. ACQUISITION OF LOCATION INFORMATION. ANY DEBT COLLECTOR COMMUNICAT-
  ING WITH ANY PERSON OTHER THAN THE CONSUMER FOR THE PURPOSE OF ACQUIRING
  LOCATION INFORMATION ABOUT THE CONSUMER  IN  ORDER  TO  COLLECT  A  DEBT
  SHALL:

    (A) IDENTIFY HIMSELF OR HERSELF, STATE THAT HE OR SHE IS CONFIRMING OR
  CORRECTING  LOCATION  INFORMATION  ABOUT  THE  CONSUMER,  AND,  ONLY  IF
  EXPRESSLY REQUESTED, IDENTIFY HIS OR HER EMPLOYER;
    (B) NOT STATE OR IMPLY THAT SUCH CONSUMER OWES ANY DEBT;
    (C) NOT COMMUNICATE WITH  ANY  SUCH  PERSON  MORE  THAN  ONCE,  UNLESS
  REQUESTED  TO  DO SO BY SUCH PERSON OR UNLESS THE DEBT COLLECTOR REASON-
  ABLY BELIEVES THAT THE EARLIER RESPONSE OF SUCH PERSON IS  ERRONEOUS  OR
  INCOMPLETE  AND  THAT  SUCH  PERSON NOW HAS CORRECT OR COMPLETE LOCATION
  INFORMATION. FOR THE PURPOSES OF THIS PARAGRAPH, THE DEBT COLLECTOR NEED
  NOT COUNT AS A COMMUNICATION RETURNED UNOPENED MAIL OR  A  MESSAGE  LEFT
  WITH  A  PARTY OTHER THAN THE PERSON THE DEBT COLLECTOR IS ATTEMPTING TO
  REACH IN ORDER TO ACQUIRE LOCATION INFORMATION ABOUT  THE  CONSUMER,  AS
  LONG  AS  THE  MESSAGE IS LIMITED TO A TELEPHONE NUMBER, THE NAME OF THE
  DEBT COLLECTOR AND A REQUEST  THAT  THE  RECIPIENT  TELEPHONE  THE  DEBT
  COLLECTOR;
    (D) NOT COMMUNICATE BY POST CARD;
    (E)  NOT USE ANY LANGUAGE OR SYMBOL ON ANY ENVELOPE OR IN THE CONTENTS
  OF ANY COMMUNICATION EFFECTED BY THE MAILS OR  TELEGRAM  THAT  INDICATES
  THAT  THE  DEBT COLLECTOR IS IN THE DEBT COLLECTION BUSINESS OR THAT THE
  COMMUNICATION RELATES TO THE COLLECTION OF A DEBT, PROVIDED THAT A  DEBT
  COLLECTOR  MAY  USE HIS OR HER BUSINESS NAME OR THE NAME OF A DEPARTMENT
  WITHIN HIS OR HER ORGANIZATION AS LONG AS ANY NAME USED DOES NOT CONNOTE
  DEBT COLLECTION; AND
    (F) IF THE DEBT COLLECTOR KNOWS THE  CONSUMER  IS  REPRESENTED  BY  AN
  ATTORNEY  WITH  REGARD TO THE SUBJECT DEBT AND IF THE DEBT COLLECTOR HAS
  KNOWLEDGE OF THE ATTORNEY'S NAME AND ADDRESS OR  CAN  READILY  ASCERTAIN
  SUCH  ATTORNEY'S NAME AND ADDRESS, NOT COMMUNICATE WITH ANY PERSON OTHER
  THAN THAT ATTORNEY FOR THE PURPOSE  OF  ACQUIRING  LOCATION  INFORMATION
  ABOUT  THE  CONSUMER UNLESS THE ATTORNEY FAILS TO PROVIDE THE CONSUMER'S
  LOCATION WITHIN A REASONABLE PERIOD OF TIME  AFTER  A  REQUEST  FOR  THE
  CONSUMER'S LOCATION FROM THE DEBT COLLECTOR AND:

    (I)  INFORMS  THE  DEBT  COLLECTOR THAT HE OR SHE IS NOT AUTHORIZED TO
  ACCEPT PROCESS FOR THE CONSUMER, OR
    (II) FAILS TO RESPOND TO THE DEBT COLLECTOR'S INQUIRY ABOUT THE ATTOR-
  NEY'S AUTHORITY TO ACCEPT PROCESS WITHIN A  REASONABLE  PERIOD  OF  TIME
  AFTER THE INQUIRY.
    2.  COMMUNICATION IN CONNECTION WITH DEBT COLLECTION.  (A) WITHOUT THE
  PRIOR WRITTEN CONSENT OF THE CONSUMER GIVEN DIRECTLY TO THE DEBT COLLEC-
  TOR AFTER THE INSTITUTION OF  DEBT  COLLECTION  PROCEDURES,  OR  WITHOUT
  PERMISSION  OF A COURT OF COMPETENT JURISDICTION, A DEBT COLLECTOR SHALL

 S. 1822--A                          5

  NOT COMMUNICATE WITH THE CONSUMER IN CONNECTION WITH THE  COLLECTION  OF
  ANY DEBT:

    (I)  ORALLY, AT ANY TIME OTHER THAN BETWEEN THE HOURS OF 8:00 A.M. AND
  9:00 P.M. LOCAL TIME OR ANY UNUSUAL PLACE  KNOWN,  OR  WHICH  SHOULD  BE
  KNOWN, TO BE INCONVENIENT TO THE CONSUMER;
    (II) AT THE CONSUMER'S PLACE OF EMPLOYMENT.  IF THE DEBT COLLECTOR HAS
  RECEIVED  CONSENT  FROM THE CONSUMER TO COMMUNICATE WITH THE CONSUMER AT
  THE CONSUMER'S PLACE OF EMPLOYMENT, THE DEBT COLLECTOR  MAY  COMMUNICATE
  WITH THE CONSUMER, UNLESS THE DEBT COLLECTOR KNOWS OR HAS REASON TO KNOW
  THAT  THE  CONSUMER'S EMPLOYER OR SUPERVISOR PROHIBITS THE CONSUMER FROM
  RECEIVING SUCH A COMMUNICATION, OR
    (III) WITH EXCESSIVE FREQUENCY. IN THE ABSENCE OF KNOWLEDGE OF CIRCUM-
  STANCES TO THE CONTRARY, A DEBT COLLECTOR SHALL ASSUME  THAT  MORE  THAN
  TWICE  DURING  A  SEVEN-CALENDAR-DAY PERIOD IS EXCESSIVELY FREQUENT.  IN
  MAKING ITS CALCULATION, THE DEBT COLLECTOR NEED NOT INCLUDE ANY COMMUNI-
  CATION BETWEEN A CONSUMER AND THE DEBT COLLECTOR WHICH IS IN RESPONSE TO
  AN ORAL OR WRITTEN COMMUNICATION FROM THE CONSUMER, OR RETURNED UNOPENED
  MAIL, OR A MESSAGE LEFT WITH A PARTY OTHER THAN ONE WHO  IS  RESPONSIBLE
  FOR  THE  DEBT  AS LONG AS THE MESSAGE IS LIMITED TO A TELEPHONE NUMBER,
  THE NAME OF THE DEBT COLLECTOR AND A REQUEST THAT ONE WHO IS RESPONSIBLE
  FOR THE DEBT TELEPHONE THE DEBT COLLECTOR; OR ANY COMMUNICATION WHICH IS
  REQUIRED BY LAW OR CHOSEN  FROM  AMONG  ALTERNATIVES  OF  WHICH  ONE  IS
  REQUIRED BY LAW.
    (B)  IN ORDER TO COLLECT A DEBT, AND EXCEPT AS PROVIDED BY SUBDIVISION
  ONE OF THIS SECTION, WITHOUT THE PRIOR WRITTEN CONSENT OF  THE  CONSUMER
  GIVEN  DIRECTLY  TO  THE  DEBT  COLLECTOR  AFTER THE INSTITUTION OF DEBT
  COLLECTION PROCEDURES, OR WITHOUT  THE  PRIOR  WRITTEN  CONSENT  OF  THE
  CONSUMER'S  ATTORNEY  OR  WITHOUT  THE  EXPRESS PERMISSION OF A COURT OF
  COMPETENT JURISDICTION, OR AS REASONABLY NECESSARY TO EFFECTUATE A  POST
  JUDGMENT  JUDICIAL  REMEDY,  A  DEBT  COLLECTOR  MAY NOT COMMUNICATE, IN
  CONNECTION WITH THE COLLECTION OF ANY DEBT, WITH ANY PERSON  OTHER  THAN
  THE CONSUMER, HIS OR HER ATTORNEY, A CONSUMER REPORTING AGENCY IF OTHER-
  WISE  PERMITTED  BY  LAW, THE CREDITOR, THE ATTORNEY OF THE CREDITOR, OR
  ATTORNEY OF THE DEBT COLLECTOR.
    (C) AFTER INSTITUTION OF DEBT COLLECTION, A DEBT COLLECTOR  SHALL  NOT
  COMMUNICATE  WITH  A CONSUMER WITH RESPECT TO A DEBT IF THE CONSUMER HAS
  NOTIFIED THE DEBT COLLECTOR IN WRITING THAT THE CONSUMER REFUSES TO  PAY
  A  DEBT OR WISHES THE DEBT COLLECTOR TO CEASE FURTHER COMMUNICATION WITH
  THE CONSUMER WITH RESPECT TO THAT DEBT, EXCEPT:

    (I) TO ADVISE THE CONSUMER THAT THE DEBT COLLECTOR'S  FURTHER  EFFORTS
  ARE BEING TERMINATED;
    (II)  TO NOTIFY THE CONSUMER THAT THE DEBT COLLECTOR MAY INVOKE SPECI-
  FIED REMEDIES WHICH ARE ORDINARILY INVOKED BY SUCH DEBT COLLECTOR;
    (III) WHERE APPLICABLE, TO NOTIFY THE CONSUMER THAT THE DEBT COLLECTOR
  INTENDS TO INVOKE A SPECIFIED REMEDY, OR
    (IV) TO RESPOND TO EACH SUBSEQUENT COMMUNICATION FROM THE CONSUMER.
    (D) FOR THE PURPOSE OF THIS SUBDIVISION THE TERM  "CONSUMER"  INCLUDES
  THE  CONSUMER'S PARENT (IF THE CONSUMER IS A MINOR), GUARDIAN, EXECUTOR,
  ADMINISTRATOR, AND SPOUSE (UNLESS THE DEBT COLLECTOR KNOWS OR HAS REASON
  TO KNOW THAT THE CONSUMER IS LEGALLY SEPARATED FROM OR NO LONGER  LIVING
  WITH  HIS OR HER SPOUSE), OR AN INDIVIDUAL AUTHORIZED BY THE CONSUMER TO
  MAKE  PURCHASES  AGAINST  THE  ACCOUNT  WHICH  IS  THE  SUBJECT  OF  THE
  COLLECTION  EFFORTS.  A  REQUEST  THAT  THE DEBT COLLECTOR CEASE FURTHER
  COMMUNICATION, PROVIDED FOR UNDER  THIS  SUBDIVISION,  IF  MADE  BY  THE
  CONSUMER'S  SPOUSE  OR  AN INDIVIDUAL AUTHORIZED BY THE CONSUMER TO MAKE

 S. 1822--A                          6

  PURCHASES AGAINST THE ACCOUNT, ONLY AFFECTS THE DEBT COLLECTOR'S ABILITY
  TO COMMUNICATE FURTHER WITH THE PERSON MAKING THE REQUEST.
    3.  HARASSMENT OR ABUSE. A DEBT COLLECTOR SHALL NOT HARASS, OPPRESS OR
  ABUSE ANY PERSON IN CONNECTION WITH THE COLLECTION OF  A  DEBT.  WITHOUT
  LIMITING THE GENERAL APPLICATION OF THE FOREGOING, THE FOLLOWING CONDUCT
  IS PROHIBITED:

    (A)  THE USE OR THREAT OF VIOLENCE OR OTHER CRIMINAL MEANS TO HARM THE
  PHYSICAL PERSON, REPUTATION, OR PROPERTY OF ANY PERSON;
    (B) THE USE OF OBSCENE OR PROFANE LANGUAGE  OR  LANGUAGE  THE  NATURAL
  CONSEQUENCE OF WHICH IS TO ABUSE THE RECIPIENT OF THE COMMUNICATION;
    (C)  THE  ADVERTISEMENT  FOR SALE OF ANY DEBT TO COERCE PAYMENT OF THE
  DEBT;
    (D) CAUSING A TELEPHONE TO RING OR ENGAGING ANY  PERSON  IN  TELEPHONE
  CONVERSATION  REPEATEDLY OR CONTINUOUSLY WITH INTENT TO ANNOY, ABUSE, OR
  HARASS ANY PERSON AT THE CALLED NUMBER;
    (E) THE PUBLICATION OF A LIST OF CONSUMERS WHO ALLEGEDLY REFUSE TO PAY
  DEBTS, EXCEPT TO ANOTHER EMPLOYEE OF THE DEBT COLLECTOR'S EMPLOYER OR TO
  A CONSUMER REPORTING AGENCY OR TO PERSONS MEETING THE REQUIREMENTS OF 15
  USC 1681A(F) OR 15 USC 1681B(3); OR
    (F) EXCEPT AS PROVIDED BY SUBDIVISION ONE OF THIS SECTION, THE  PLACE-
  MENT  OF  TELEPHONE  CALLS WITHOUT MEANINGFUL DISCLOSURE OF THE CALLER'S
  IDENTITY.
    4. FALSE OR MISLEADING REPRESENTATIONS. A  DEBT  COLLECTOR  SHALL  NOT
  MAKE  ANY  FALSE,  DECEPTIVE,  OR  MISLEADING REPRESENTATION OR MEANS IN
  CONNECTION WITH THE COLLECTION OF ANY DEBT. WITHOUT LIMITING THE GENERAL
  APPLICATION OF THE FOREGOING, THE FOLLOWING CONDUCT IS PROHIBITED:

    (A) THE FALSE REPRESENTATION OR IMPLICATION THAT THE DEBT COLLECTOR IS
  VOUCHED FOR, BONDED BY, OR AFFILIATED WITH  THE  UNITED  STATES  OR  ANY
  STATE, INCLUDING THE USE OF ANY BADGE, UNIFORM OR FACSIMILE THEREOF;
    (B) THE FALSE REPRESENTATION OF:

    (I) THE CHARACTER, AMOUNT, OR LEGAL STATUS OF ANY DEBT, OR
    (II)  ANY  SERVICES  RENDERED  OR  COMPENSATION  WHICH MAY BE LAWFULLY
  RECEIVED BY ANY DEBT COLLECTOR FOR THE COLLECTION OF A DEBT;
    (C) THE FALSE REPRESENTATION OR IMPLICATION THAT ANY INDIVIDUAL IS  AN
  ATTORNEY OR ANY COMMUNICATION IS FROM AN ATTORNEY;
    (D) THE REPRESENTATION OR IMPLICATION THAT NONPAYMENT OF ANY DEBT WILL
  RESULT  IN  THE  ARREST  OR  IMPRISONMENT  OF ANY PERSON OR THE SEIZURE,
  GARNISHMENT, ATTACHMENT, OR SALE OF ANY PROPERTY OR WAGES OF ANY  PERSON
  UNLESS  SUCH ACTION IS LAWFUL AND THE DEBT COLLECTOR OR CREDITOR INTENDS
  TO PURSUE SUCH ACTION;
    (E) THE THREAT TO TAKE ANY ACTION THAT CANNOT LEGALLY BE TAKEN OR THAT
  IS NOT INTENDED TO BE TAKEN;
    (F) THE FALSE REPRESENTATION OR IMPLICATION THAT A SALE, REFERRAL,  OR
  OTHER TRANSFER OF ANY INTEREST IN A DEBT SHALL CAUSE THE CONSUMER TO:

    (I) LOSE ANY CLAIM OR DEFENSE TO PAYMENT OF THE DEBT; OR
    (II) BECOME SUBJECT TO ANY PRACTICE PROHIBITED BY THIS ARTICLE;
    (G)  THE FALSE REPRESENTATION OR IMPLICATION MADE IN ORDER TO DISGRACE
  THE CONSUMER THAT THE CONSUMER COMMITTED ANY CRIME OR OTHER CONDUCT;
    (H) THE FALSE REPRESENTATION OR IMPLICATION THAT  ACCOUNTS  HAVE  BEEN
  TURNED OVER TO INNOCENT PURCHASERS FOR VALUE;
    (I)  COMMUNICATING  OR THREATENING TO COMMUNICATE TO ANY PERSON CREDIT
  INFORMATION WHICH IS KNOWN OR WHICH SHOULD BE KNOWN TO BE FALSE, INCLUD-
  ING THE FAILURE TO COMMUNICATE A DISPUTED DEBT'S STATUS AS DISPUTED;
    (J) THE FALSE REPRESENTATION OR IMPLICATION THAT DOCUMENTS  ARE  LEGAL
  PROCESS;

 S. 1822--A                          7

    (K)  THE USE OF ANY FALSE REPRESENTATION OR DECEPTIVE MEANS TO COLLECT
  OR ATTEMPT TO COLLECT ANY DEBT OR TO  OBTAIN  INFORMATION  CONCERNING  A
  CONSUMER;
    (L)  THE  USE OR DISTRIBUTION OF ANY WRITTEN COMMUNICATION WHICH SIMU-
  LATES OR IS FALSELY REPRESENTED TO BE A DOCUMENT AUTHORIZED, ISSUED,  OR
  APPROVED  BY  ANY  COURT,  OFFICIAL  OR AGENCY OF THE UNITED STATES, THE
  STATE OR ANY POLITICAL SUBDIVISION THEREOF, OR  WHICH  CREATES  A  FALSE
  IMPRESSION AS TO ITS SOURCE, AUTHORIZATION, OR APPROVAL;
    (M)  THE  FALSE  REPRESENTATION  OR IMPLICATION THAT DOCUMENTS ARE NOT
  LEGAL PROCESS FORMS AND DO NOT REQUIRE ACTION BY THE CONSUMER;
    (N) THE FALSE REPRESENTATION OR  IMPLICATION  THAT  A  DEBT  COLLECTOR
  OPERATES  OR IS EMPLOYED BY A CONSUMER REPORTING AGENCY AS DEFINED BY 15
  USC 1681A(F);
    (O) COMMUNICATING OR THREATENING TO COMMUNICATE TO ANY  PERSON  CREDIT
  INFORMATION WHICH IS KNOWN OR WHICH SHOULD BE KNOWN TO BE FALSE, INCLUD-
  ING THE FAILURE TO COMMUNICATE A DISPUTED DEBT'S STATUS AS DISPUTED;
    (P) EXCEPT AS OTHERWISE PROVIDED UNDER SUBDIVISION ONE OF THIS SECTION
  AND EXCEPT FOR ANY COMMUNICATION WHICH IS REQUIRED BY LAW OR CHOSEN FROM
  AMONG ALTERNATIVES OF WHICH ONE IS REQUIRED BY LAW, OR ANY FORMAL PLEAD-
  ING IN CONNECTION WITH ANY LEGAL ACTION, THE FAILURE TO DISCLOSE CLEARLY
  IN  ALL  COMMUNICATIONS  MADE TO COLLECT A DEBT OR TO OBTAIN INFORMATION
  ABOUT A CONSUMER, THAT THE DEBT COLLECTOR IS  ATTEMPTING  TO  COLLECT  A
  DEBT AND THAT ANY INFORMATION OBTAINED WILL BE USED FOR THAT PURPOSE; OR
    (Q)  THE USE OF ANY BUSINESS, COMPANY, OR ORGANIZATION NAME OTHER THAN
  THE TRUE NAME OF THE DEBT COLLECTOR'S BUSINESS,  COMPANY,  OR  ORGANIZA-
  TION.
    5.  UNFAIR  PRACTICES.  A  DEBT  COLLECTOR SHALL NOT USE ANY UNFAIR OR
  UNCONSCIONABLE MEANS TO COLLECT OR ATTEMPT TO COLLECT  A  DEBT.  WITHOUT
  LIMITATION OF THE FOREGOING, SUCH PROHIBITED CONDUCT INCLUDES:

    (A) THE COLLECTION OF ANY AMOUNT (INCLUDING ANY INTEREST, FEE, CHARGE,
  OR EXPENSE INCIDENTAL TO THE PRINCIPAL OBLIGATION) UNLESS SUCH AMOUNT IS
  EXPRESSLY AUTHORIZED BY THE AGREEMENT CREATING THE DEBT;
    (B) THE SOLICITATION OR USE BY A DEBT COLLECTOR OF ANY POSTDATED CHECK
  OR  OTHER POSTDATED PAYMENT INSTRUMENT FOR THE PURPOSE OF THREATENING OR
  INSTITUTING CRIMINAL PROSECUTION;
    (C) CAUSING CHARGES TO BE MADE TO ANY  PERSON  FOR  COMMUNICATIONS  BY
  MISREPRESENTATION  OF  TRUE  PURPOSE  OF THE COMMUNICATION. SUCH CHARGES
  INCLUDE COLLECT TELEPHONE CALLS, TELEGRAM AND WIRELESS TELEPHONE FEES;
    (D) TAKING OR THREATENING TO TAKE ANY  NONJUDICIAL  ACTION  TO  EFFECT
  DISPOSSESSION OR DISABLEMENT OF PROPERTY IF:

    (I) THERE IS NO PRESENT RIGHT TO POSSESSION OF THE PROPERTY CLAIMED AS
  COLLATERAL;
    (II) THERE IS NO PRESENT INTENTION TO TAKE POSSESSION OF THE PROPERTY;
  OR
    (III)  THE  PROPERTY IS EXEMPT BY LAW FROM SUCH DISPOSSESSION OR DISA-
  BLEMENT;
    (E) COMMUNICATING WITH A CONSUMER REGARDING A DEBT BY POST CARD;
    (F) USING ANY LANGUAGE OR SYMBOL,  OTHER  THAN  THE  DEBT  COLLECTOR'S
  ADDRESS,  ON  ANY  ENVELOPE WHEN COMMUNICATING WITH A CONSUMER BY USE OF
  THE MAILS OR BY TELEGRAM, OR ELECTRONIC COMMUNICATION COPIED TO A  THIRD
  PARTY  EXCEPT  THAT A DEBT COLLECTOR MAY USE HIS OR HER BUSINESS NAME OR
  THE NAME OF A DEPARTMENT WITHIN HIS OR HER ORGANIZATION AS LONG  AS  ANY
  NAME  USED  DOES  NOT INDICATE THAT HE OR SHE IS IN THE BUSINESS OF DEBT
  COLLECTION;
    (G) COMMUNICATING WITH A CONSUMER REGARDING A DEBT WITHOUT IDENTIFYING
  HIMSELF OR HERSELF AND HIS OR HER EMPLOYER OR COMMUNICATING  IN  WRITING

 S. 1822--A                          8

  WITH  A CONSUMER REGARDING A DEBT WITHOUT IDENTIFYING HIMSELF OR HERSELF
  BY NAME AND ADDRESS; OR
    (H)  IF  ANY CONSUMER OWES MULTIPLE DEBTS AND MAKES ANY SINGLE PAYMENT
  TO ANY DEBT COLLECTOR WITH RESPECT TO SUCH DEBTS,  SUCH  DEBT  COLLECTOR
  MAY NOT APPLY SUCH PAYMENT TO ANY DEBT WHICH IS DISPUTED BY THE CONSUMER
  AND,  WHERE  APPLICABLE, SHALL APPLY SUCH PAYMENT IN ACCORDANCE WITH THE
  CONSUMER'S DIRECTIONS.
    6. DECEPTIVE FORMS. IT IS UNLAWFUL FOR ANY PERSON TO  DESIGN,  COMPILE
  AND  FURNISH ANY FORM KNOWING THAT SUCH FORM WOULD BE USED TO CREATE THE
  FALSE BELIEF IN A CONSUMER THAT A PERSON OTHER THAN THE CREDITOR OF SUCH
  CONSUMER IS PARTICIPATING IN THE COLLECTION  OF  OR  IN  AN  ATTEMPT  TO
  COLLECT  A DEBT SUCH CONSUMER ALLEGEDLY OWES SUCH CREDITOR, WHEN IN FACT
  SUCH PERSON IS NOT SO PARTICIPATING.
    7. VALIDATION OF DEBTS.  THE FOLLOWING VALIDATION PROCEDURES SHALL  BE
  FOLLOWED BY DEBT COLLECTORS:

    (A)  WITHIN  FIVE DAYS AFTER THE INITIAL COMMUNICATION WITH A CONSUMER
  IN CONNECTION WITH THE COLLECTION OF ANY DEBT, A DEBT  COLLECTOR  SHALL,
  UNLESS  THE  FOLLOWING  INFORMATION IS CONTAINED IN THE INITIAL COMMUNI-
  CATION OR THE CONSUMER HAS PAID THE DEBT,  SEND  THE  CONSUMER  A  CLEAR
  WRITTEN NOTICE TITLED "DEBTOR'S RIGHTS," WHICH SHALL CONTAIN:

    (I)  THE  DELINEATED  AMOUNTS  OF  THE ORIGINAL DEBT, ANY INTEREST AND
  PENALTIES ACCRUED, AND THE TOTAL DEBT DUE AT THE TIME OF THE NOTICE,
    (II) THE NAME, ADDRESS AND TELEPHONE NUMBER OF THE  CREDITOR  TO  WHOM
  THE  DEBT  IS  OWED, OR SUCH CREDITOR'S AGENT, AND THE NAME, ADDRESS AND
  TELEPHONE NUMBER OF THE ORIGINAL CREDITOR, IF DIFFERENT FROM THE CURRENT
  DEBT COLLECTOR,
    (III) THE DATE THE DEBT WAS DEEMED IN DEFAULT,
    (IV) A STATEMENT THAT UNLESS THE CONSUMER, WITHIN  THIRTY  DAYS  AFTER
  RECEIPT OF THE NOTICE, DISPUTES THE VALIDITY OF THE DEBT, OR ANY PORTION
  THEREOF, THE DEBT WILL BE ASSUMED VALID BY THE DEBT COLLECTOR, AND
    (V)  A  STATEMENT THAT, IF THE CONSUMER NOTIFIES THE DEBT COLLECTOR IN
  WRITING WITHIN THE THIRTY-DAY PERIOD AT THE ADDRESS  DESIGNATED  BY  THE
  DEBT  COLLECTOR  IN THE NOTICE, THAT THE DEBT, OR ANY PORTION THEREOF IS
  DISPUTED, THE DEBT  COLLECTOR  WILL  OBTAIN  VERIFICATION  OF  THE  DEBT
  AGAINST  THE  CONSUMER AND A COPY OF SUCH VERIFICATION WILL BE MAILED TO
  THE CONSUMER BY THE DEBT COLLECTOR.
    (B) IF THE CONSUMER NOTIFIES THE DEBT COLLECTOR IN WRITING WITHIN  THE
  THIRTY  DAY  PERIOD  DESCRIBED IN PARAGRAPH (A) OF THIS SUBDIVISION THAT
  THE DEBT, OR ANY PORTION THEREOF IS  DISPUTED,  OR  IF  NOTICE  OF  SUCH
  DISPUTE  IS GIVEN TO THE DEBT COLLECTOR IN ACCORDANCE WITH THIS ARTICLE,
  THE DEBT COLLECTOR SHALL NOT ATTEMPT TO COLLECT THE  AMOUNT  IN  DISPUTE
  UNTIL  THE DEBT COLLECTOR OBTAINS AND MAILS TO THE CONSUMER VERIFICATION
  OF THE DEBT.  A DEBT COLLECTOR THAT RECEIVES SUCH WRITTEN  NOTICE  SHALL
  PROVIDE A COPY THEREOF TO THE OWNER OF THE DEBT.
    (C)  THE  DEBT COLLECTOR SHALL MAINTAIN FOR ONE YEAR FROM THE DATE THE
  DEBTOR'S RIGHTS NOTICE WAS MAILED, DOCUMENTATION OF THE DATE SUCH NOTICE
  WAS MAILED, THE DATE THE RESPONSE, IF ANY, WAS RECEIVED AND  ANY  ACTION
  TAKEN FOLLOWING SUCH RESPONSE.
    (D)  THE FAILURE OF A CONSUMER TO DISPUTE THE VALIDITY OF A DEBT UNDER
  THIS SECTION SHALL NOT BE CONSTRUED BY ANY  COURT  AS  AN  ADMISSION  OF
  LIABILITY BY THE CONSUMER.
    (E)  THE  SENDING  OR  DELIVERY  OF  ANY FORM OR NOTICE WHICH DOES NOT
  RELATE TO DEBT COLLECTION AND IS  EXPRESSLY  REQUIRED  BY  THE  INTERNAL
  REVENUE  CODE  OF  1986,  TITLE  V OF THE GRAMM-LEACH-BLILEY ACT, OR ANY
  PROVISION OF FEDERAL OR STATE LAW RELATING TO NOTICE  OF  DATA  SECURITY
  BREACH OR PRIVACY, OR ANY REGULATION PRESCRIBED UNDER ANY SUCH PROVISION

 S. 1822--A                          9

  OF  LAW,  SHALL NOT BE TREATED AS AN INITIAL COMMUNICATION IN CONNECTION
  WITH DEBT COLLECTION FOR PURPOSES OF THIS SECTION.
    (F)  IF  THE CONSUMER NOTIFIES THE DEBT COLLECTOR IN WRITING AFTER THE
  THIRTY-DAY PERIOD DESCRIBED IN PARAGRAPH (A) OF  THIS  SUBDIVISION  THAT
  THE  DEBT,  OR ANY PORTION THEREOF IS DISPUTED, THE DEBT COLLECTOR SHALL
  OBTAIN VERIFICATION OF THE DEBT,  AND  MAIL  SUCH  VERIFICATION  TO  THE
  CONSUMER.  THE  DEBT  COLLECTOR  MAY  CONTINUE TO ATTEMPT TO COLLECT THE
  AMOUNT IN DISPUTE.
    S 603-A. SELLING OR TRANSFERRING OF DEBTS. EVERY DEBT PURCHASER OR HIS
  OR HER AGENT SHALL SEND A NOTICE TO THE LAST KNOWN ADDRESS OF THE DEBTOR
  ADVISING THE DEBTOR WHEN THE DEBT PURCHASER SELLS OR TRANSFERS THE DEBT,
  PRIOR TO OR CONTEMPORANEOUS WITH THE SALE OF THE DEBT. A  COPY  OF  SUCH
  NOTICE  SHALL BE TRANSMITTED TO THE PERSON, FIRM, ORGANIZATION OR ENTITY
  TO WHOM THE DEBT PURCHASER OR HIS OR HER AGENT HAS  AGREED  TO  SELL  OR
  TRANSFER  THE DEBT ALONG WITH A COPY OF ANY NOTICE IN REGARD TO THE DEBT
  PROVIDED TO THE DEBT PURCHASER  IN  ACCORDANCE  WITH  PARAGRAPH  (B)  OF
  SUBDIVISION  SEVEN  OF SECTION SIX HUNDRED THREE OF THIS ARTICLE. A DEBT
  PURCHASER SHALL PROVIDE A COPY OF SUCH  NOTICE  TO  ANY  DEBT  COLLECTOR
  HIRED TO COLLECT SUCH DEBT.
    S  603-B.  PRIVATE  RIGHT  OF ACTION. (A) NOTWITHSTANDING ANY RIGHT OF
  ACTION GRANTED TO ANY GOVERNMENTAL BODY PURSUANT TO  THIS  ARTICLE,  ANY
  PERSON  WHO  HAS BEEN INJURED BY REASON OF VIOLATION OF THIS ARTICLE MAY
  BRING AN ACTION AGAINST ANY PERSON OR PERSONS, TO ENJOIN  SUCH  UNLAWFUL
  ACT,  AND  TO RECOVER AN AMOUNT EQUAL TO (1) ANY ACTUAL DAMAGE SUSTAINED
  BY SUCH PERSON AS A RESULT OF SUCH  FAILURE,  AND  (2)  SUCH  ADDITIONAL
  DAMAGES  AS  THE  COURT  MAY  ALLOW  BUT NOT EXCEEDING TWO THOUSAND FIVE
  HUNDRED DOLLARS, AND REASONABLE ATTORNEY'S FEES.
    (B) INTENT. A DEBT COLLECTOR MAY NOT BE  HELD  LIABLE  IN  ANY  ACTION
  BROUGHT UNDER THIS ARTICLE, ABSENT ACTUAL DAMAGE TO THE CONSUMER, IF THE
  DEBT  COLLECTOR  SHOWS BY A PREPONDERANCE OF EVIDENCE THAT THE VIOLATION
  WAS NOT INTENTIONAL AND RESULTED FROM A BONA FIDE ERROR  NOTWITHSTANDING
  THE  MAINTENANCE  OF  PROCEDURES  REASONABLY  ADAPTED  TO AVOID ANY SUCH
  ERROR.
    (C) LIMITATIONS. AN ACTION TO ENFORCE ANY LIABILITY  CREATED  BY  THIS
  ARTICLE  MAY  BE  BROUGHT  IN ANY OTHER COURT OF COMPETENT JURISDICTION,
  WITHIN TWO YEARS FROM THE DATE ON WHICH THE VIOLATION OCCURS.
    S [602] 603-C.   Violations and  penalties.  1.  Except  as  otherwise
  provided  by  law,  any person who [shall violate] VIOLATES the terms of
  this article [shall be] IS  guilty  of  a  misdemeanor,  and  each  such
  violation shall be deemed a separate offense.
    2.  The  attorney  general  or the district attorney of any county may
  bring an action in the name of the people of the state  to  restrain  or
  prevent  any  violation  of  this article or any continuance of any such
  violation.
    3. Any aggrieved person or entity served with more than fifty informa-
  tion subpoenas per month by a [principal] creditor or his or  her  agent
  shall  also have a cause of action to challenge compliance with subdivi-
  sion ten of section six hundred one of this article and/or  the  certif-
  ication  requirements of rule fifty-two hundred twenty-four of the civil
  practice law and rules. In such action, a successful plaintiff shall  be
  awarded  ten  dollars  for  each  information  subpoena served upon such
  plaintiff where it is shown that the  required  certification  for  such
  information  subpoena  was  not  made pursuant to rule fifty-two hundred
  twenty-four of the civil practice  law  and  rules,  that  the  required
  record  for  such  information  subpoena  was not maintained pursuant to
  subdivision ten of section six hundred one of this article, or that  the

 S. 1822--A                         10

  specific grounds for the certification required to accompany such infor-
  mation  subpoena  pursuant  to rule fifty-two hundred twenty-four of the
  civil practice law and rules were not reasonable. A successful plaintiff
  may also be awarded court costs and attorney fees.
    S  [603] 603-D.  Severability. If any provision of this article or the
  application thereof to any person or circumstances is held  invalid  the
  invalidity  thereof shall not affect other provisions or applications of
  the article which can be given effect without the invalid  provision  or
  application,  and  to  this [and] END the provisions of this article are
  severable.
    S 2. This act shall take effect on the first of January next  succeed-
  ing  the  date  on  which it shall have become a law, provided, however,
  that section 602, subdivision 7 of section 603 and section 603-a of  the
  general  business  law,  as added by this act, shall apply only to debts
  incurred on or after the effective date of such sections.