If you are a business of less than 100 employees doing business in New York state, please comment by 5 P.M Eastern, Monday, November 8th.
BACKGROUND
On Friday, October 29th the New York State Department of Financial Services (DFS) issued proposed revisions to the regulation adopted in 2014 which regulates third-party collection agencies and debt buyers (23 NYCRR Part 1). In an accompanying communication, DFS provides that the amendments are “intended to help ensure consumers pay only debts they owe and pay them only once, by improving consumers’ access to information about alleged debts and mitigating opportunity for predatory debt collection.” However, RMAI is concerned that the proposed rules will create multiple conflicts with state law and CFPB Regulation F and would among other things:
- Require pre-charge-off itemization of credit card balances
- Prohibit the collection of debt that is beyond the statute of limitations by phone (you could still send letters)
- Limit call attempts to three calls per week
- Require complex consumer notices
HOW YOU CAN COMMENT
Under a recent New York state requirement, DFS must first reach out to small businesses (defined as fewer than 100 employees) to seek comments on how the proposed rule would impact their operations before publishing the rule for public comment. This comment period is only 10 days, and all comments must be submitted by close of business on Monday, November 8th. If you are a business with less than 100 employees, please send a straightforward and respectful email communication to DFS Deputy General Counsel, Meredith Weill at meredith.weill@dfs.ny.gov, saying “Please Wait on the Revised Collection Regulation until 2023” in the subject and by highlighting the following:
- State the name of your business, indicate that you are a small business, and state the number of employees you employ. If you are a business located in New York State, also indicate the city or town where you are located.
- Explain that you are in the tail-end of a 12-month process of implementing CFPB Regulation F which goes into effect on November 30, 2021 – the most significant change to national collection practices in over 43 years. Further explain that the successful implementation of Reg F is of paramount concern, which as a small business is taking all of your time, resources, and bandwidth.
- Stress that as a small business you simply cannot afford the time to appropriately analyze the proposed DFS rule right now, nor do you have the financial resources to implement the proposed changes as they are being spent on Reg F implementation and compliance.
- Tell DFS that the New York State Legislature adopted two new laws in 2020 related to large print notification (S 737) and on statute of limitations and litigation (S 153) which is going to take additional financial resources in addition to those costs you are already spending on Reg F implementation. Add that any major change to New York’s regulations at this point is very ill-timed for your small businesses.
- Conclude by asking them to allow you as a small business the time to successfully implement Reg F, SB 737, and SB 537 before adding additional requirements.
RMAI will also be responding with a similar message on behalf of all RMAI members along with a more detailed analysis related to the proposed requirements. We recommend that you not spend the time getting into the weeds of the proposal – just focus on the points made above. Also, please try to make the above points in your own words to the degree that you can so that it does not look like a form letter response. Messages that are unique or personalized resonate more.
If you have any questions, please contact RMAI General Counsel David Reid at (916)779-2492 or dreid@rmaintl.org.
This Member Alert is intended for members of the Receivables Management Association International, is for informational purposes only, and is in no way intended to provide legal advice. Members are encouraged to consult with an attorney of their choice for legal advice concerning this matter.