§ 604-BB — Notice of coerced debt

* § 604-bb. Notice of coerced debt. 1. Upon receipt of the following,\na creditor shall cease collection activities until completion of the\nreview under subdivision three of this section:\n (a) adequate documentation of coerced debt; and\n (b) the debtor's statement that a particular debt being collected, or\nportion thereof, is coerced debt.\n 2. (a) If a debtor notifies a creditor, either orally or in writing,\nthat a debt is a coerced debt but does not provide the documentation\nrequired in subdivision one of this section, or such documentation is\ninsufficient, such creditor shall provide written notice to such debtor\nthat includes the following text:\n "UNDER NEW YORK GENERAL BUSINESS LAW 604-BB, YOU HAVE THE RIGHT TO\nDISPUTE DEBT THAT YOU BELIEVE IS COERCED DEBT. A DEBT IS "COERCED" WHEN\nIT IS INCURRED IN A CONSUMER'S NAME BECAUSE OF THREATS, INTIMIDATION, OR\nFORCE BY ANOTHER PERSON.\n TO DISPUTE COERCED DEBT, YOU MUST SUBMIT A "NOTICE OF COERCED DEBT" IN\nWRITING. THE "NOTICE OF COERCED DEBT" MUST INCLUDE TWO DOCUMENTS:\n 1 - A SWORN OR NOTARIZED STATEMENT BY YOU, THE ALLEGED DEBTOR, STATING\nTHAT A CERTAIN DEBT OR PORTION OF A DEBT BEING COLLECTED IS COERCED\nDEBT.\n 2 - "ADEQUATE DOCUMENTATION OF COERCED DEBT"\n TO PROVIDE "ADEQUATE DOCUMENTATION OF COERCED DEBT," YOU ARE REQUIRED\nTO PROVIDE ONLY ONE OF THE FOLLOWING DOCUMENTS, BUT YOU MAY PROVIDE MORE\nTHAN ONE.\n 1 - A POLICE REPORT\n 2 - A FEDERAL TRADE COMMISSION IDENTITY THEFT REPORT\n 3 - A COURT ORDER FINDING THAT THE DEBT WAS COERCED\n 4 - A NOTARIZED STATEMENT FROM A "QUALIFIED THIRD PARTY" THAT YOU\nREPORTED THE COERCED DEBT TO.\n EXAMPLES OF "QUALIFIED THIRD PARTIES" INCLUDE SOCIAL WORKERS AND\nATTORNEYS; DOCTORS, NURSES, AND THERAPISTS; EMPLOYEES FROM GOVERNMENT OR\nNON-PROFIT AGENCIES THAT WORK WITH SURVIVORS OF VIOLENCE; MEMBERS OF THE\nCLERGY; ELECTED OFFICIALS; AND LAW ENFORCEMENT OFFICERS.\n NO MATTER WHICH FORM OF "ADEQUATE DOCUMENTATION OF COERCED DEBT" YOU\nPROVIDE, IT MUST IDENTIFY THE PARTICULAR DEBT, STATE THAT IT IS COERCED\nDEBT, AND DESCRIBE THE CIRCUMSTANCES THAT CAUSED THE DEBT TO BE\nINCURRED.\n TO DISPUTE DEBT THAT YOU BELIEVE IS COERCED DEBT, PLEASE SEND THE\nREQUIRED DOCUMENTS TO (DESIGNATED ADDRESS). AFTER RECEIVING YOUR NOTICE\nOF COERCED DEBT, WE WILL INVESTIGATE YOUR CLAIM AND RESPOND IN WRITING\nWITHIN 35 BUSINESS DAYS. FOR MORE INFORMATION, PLEASE CALL (DESIGNATED\nPHONE NUMBER)."\n (b) If a debtor notifies a creditor in writing that a particular debt\nbeing collected, or portion thereof, is coerced debt, but omits\ninformation under subdivision one of this section, and if such creditor\ndoes not cease such collection activities, such creditor shall provide\nwritten notice to such debtor of the additional information that is\nrequired.\n 3. (a) Within ten business days of receiving the information under\nsubdivision one of this section, the creditor shall, if such creditor\nfurnishes adverse information about the debtor to a consumer reporting\nagency, notify such consumer reporting agency that the account is\ndisputed.\n (b) Within thirty business days of receiving the information under\nsubdivision one of this section, the creditor shall complete a review\nconsidering all information provided by the debtor and other information\navailable to such creditor in such creditor's file. In connection with\nsuch review and communication of the outcome of such review, the\ncreditor shall:\n (i) neither directly nor indirectly contact the individual accused of\ncausing the coerced debt to be incurred;\n (ii) use only the contact information the debtor provides with the\ninformation under subdivision one of this section when attempting to\ncontact such debtor and shall not use any other contact information,\neven if associated with the account under review, when attempting to\ncontact such debtor; and\n (iii) not disclose the documents, information, or contact information\nthe debtor provides with the information under subdivision one of this\nsection to any other person, including, but not limited to, joint\naccount holders, without such debtor's express written authorization.\nFor purposes of this subparagraph, sending documents, information, or\ncontact information the debtor provides under subdivision one of this\nsection to a mailing or electronic mail address other than the one\nprovided by the debtor constitutes unlawful disclosure to a third party,\neven if such mail or electronic mail address is associated with the\naccount.\n (c) Within five business days of completing the review under paragraph\n(b) of this subdivision, a creditor who recommences collection\nactivities based on such review shall notify the debtor in writing of\nsuch creditor's determination and the good faith basis for such\ndetermination, and shall enclose all documents and information upon\nwhich such creditor bases its determination therewith, provided however\nsuch documentation shall not include personally identifiable information\nof another person. Such written notice shall include a notice of the\ndebtor's right to request reconsideration of such determination to\nrecommence collection activities under subdivision four of this section.\n (d) Within five business days of completing the review under paragraph\n(b) of this subdivision, a creditor who ceases collection activities\nunder this section and, based on such review, does not recommence such\ncollection activities, shall:\n (i) notify the debtor in writing that it is ceasing collection\nactivities based on such debtor's claim of coerced debt;\n (ii) contact any consumer reporting agencies to which it furnishes\ninformation about the debtor and the particular debt and instruct such\nconsumer reporting agencies to delete such information; and\n (iii) if the creditor is also a debt collector or debt collection\nagency, as defined in section six hundred of this chapter, notify the\noriginal creditor that it has ceased collection activities because the\ndebt was found to be a coerced debt.\n 4. A debtor who receives written notice under paragraph (c) of\nsubdivision three of this section that the creditor will recommence\ncollection activities against such debtor based on such creditor's\ndetermination under subdivision three of this section may make a request\nto the creditor that the creditor reconsider such determination to\nrecommence collection activities within thirty days of the date of\nmailing of such written determination. A debtor requesting\nreconsideration of a creditor's determination to recommence collection\nactivities shall be permitted to submit additional adequate\ndocumentation of coerced debt, as defined in this article. A creditor\nwho receives a debtors request for reconsideration shall complete a\nreview of all information, including additional adequate documentation\nsubmitted, within thirty days of receiving such request. Submitting a\nrequest for reconsideration of the determination to the creditor shall\nnot be a condition to bringing an action under section six hundred\nfour-cc of this article.\n 5. No inference or presumption that the debt is valid or invalid, or\nthat the debtor is liable or not liable for such debt, shall arise if\nthe creditor decides after completing the review under subdivision three\nof this section to cease or recommence the debt collection activities.\nThe exercise or non-exercise of rights under this section shall not\nconstitute a waiver of any other right or defense of the debtor,\ncreditor, debt collector, or any other person.\n 6. Ceasing collection activities under this section shall not toll the\nstatute of limitations period on any action to collect the debt.\n 7. If at any time any individual or entity, including, but not limited\nto the creditor, such creditor's assignor, or any assignee, recommences\ncollection activities on the debt after ceasing collection activities on\nsuch debt based on such creditor's review of such debtor's notice of\ncoerced debt, such debtor may submit a subsequent notice of coerced\ndebt. A subsequent notice of coerced debt submitted under this\nsubdivision shall be governed by subdivisions one through six of this\nsection.\n 8. A debtor injured by a violation of this section shall have a cause\nof action against the creditor to recover statutory damages of one\nthousand dollars, actual damages, if any, and the costs and attorneys'\nfees reasonably incurred in bringing such action.\n * NB Effective March 19, 2026\n