In response to many inquiries regarding its out-of-statute requirements, the New York City Department of Consumer Affairs (NYC) issued this letter on July 31, 2015. The requirements have caused confusion because of their apparent conflict with those issued by the New York State Department of Financial Services (NYDFS).
NYC says that the disclosure language provided in § 1.3(c) of Title 23 of the New York Code of Rules and Regulations (“NYCRR”) DOES SATISFY the disclosure required by § 20-493.2(b) of the Administrative Code of the City of New York (the “Code”) and § 2-191 of Title 6 of the Rules of the City of New York (the “Rules” or “6 RCNY”), with one caveat.
According to the letter:
Debt collection agencies are prohibited from contacting New York City consumers about or seeking to collect a debt from New York City consumers for which the statute of limitations has expired unless the debt collection agency first provides the consumer information about her legal rights as prescribed by the Rules. See Code § 20-493.2(b).
The out-of-statute disclosure must be provided in every communication to a New York City consumer “for each debt that the debt collection agency is seeking to collect that is past the applicable statute of limitations.” 6 RCNY § 2-191(a). If the out-of-statute disclosure is delivered in writing, the disclosure must be “in at least 12 point type that is set off in a sharply contrasting color from all other type” and must be placed adjacent to the amount claimed due on the debt. 6 RCNY § 2-191.
6 RCNY §2-191(a) prescribes the language of the out-of-statute disclosure that is similar to, but not the same as, the language provided in 23 NYCRR § 1.3. Given the similarity, a debt collection agency may use the language provided in 23 NYCRR § 1.3(c) in place of the language in 6 RCNY § 2-191(a). However, debt collection agencies must adhere to the size, color, and placement requirements provided for in 6 RCNY § 2-191(b).