Mark Twain once allegedly quipped, “No man’s life, liberty or property is safe when the legislature is in session.”
In January, most state legislatures open new sessions and with new sessions come new laws. California led the way last year with new restrictions on the accounts receivable industry. Other states are not far behind.
New York is proposing a law that would require a Miranda warning on the initial contact with the debtor. This “Miranda warning” is fairly long and details all of the protections that would be available to a debtor under New York law. In addition, the required notice also must include contact information for the Attorney General.
This bill has been referred to a committee.
In Illinois, a similar bill has been proposed.
Both bills reflect a couple of realities. First, no one likes debt collectors. Second, as with many other industries, the receivables management industry has a choice. It can clean up and become compliant from within or the government will impose draconian regulations.
Compliance is a much easier road.