New information is available regarding disclosures for accounts based in the state of New York. The Receivables Management Association believes this to be of interest to our Members.

Debt buyers and third-party collection agencies who collect debt in the state of New York are required to adhere to rules set forth by the New York Department of Financial Services (DFS). The regulation lists out disclosure and communication requirements, including itemization of all charges, fees, interest, and/or payments made since charge-off of the debt, per rule 23 NYCRR 1.2(b)(2).

The New York DFS recently released an update of their FAQs, clarifying that “if there is no interest accrued, charges or feed added, or payments made on the debt since charge-off”, the debt collector must still list the item “in a clear and conspicuous manner” by indicating “0” or “Not Applicable” for that item.
The rule reads as follows:

(b) Within 5 days after the initial communication with a consumer in connection with the collection of any charged-off debt, a debt collector shall, unless the following information is contained in the initial communication or the consumer has paid the debt, provide the consumer clear and conspicuous written notification of the following:

(1) The name of the original creditor; and
(2) An itemized accounting of the debt, including:

(i) the total amount of the debt due as of charge-off;
(ii) the total amount of interest accrued since charge-off;
(iii) the total amount of non-interest charges or fees accrued since charge-off;
(iv) the total amount of payments made on the debt since the charge-off.

This Alert is intended for Members of the Receivables Management Association International (formerly DBA International) and 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.