New York Attorney General Letitia James recently introduced a bill aimed at safeguarding consumers and small businesses in the state from fraudulent practices by lenders, debt collectors, and healthcare companies. The proposed legislation, known as the Fostering Affordability and Integrity through Reasonable Business Act, seeks to enhance New York’s existing consumer protection law, which has been in place since 1970 but is limited in scope. This move comes at a crucial time when the federal agency responsible for consumer protection has been significantly weakened under the Trump administration.
The FAIR Business Practices Act, as it is called, has garnered support from state lawmakers Senator Leroy Comrie and Assemblymember Micah Lasher. Attorney General James emphasized the importance of closing loopholes that allow for scams to thrive in New York, such as making it excessively difficult to cancel subscriptions, allowing nursing homes to sue relatives of deceased residents, and enabling debt collectors to unlawfully seize social security benefits. The new bill aims to empower the Attorney General’s office to take action against entities that violate consumer protection laws.
With the Consumer Financial Protection Bureau (CFPB) facing challenges due to recent changes in leadership and direction, state officials like Letitia James are stepping up to fill the void in consumer protection. Acting Director Russell Vought’s controversial decision to halt most of the agency’s operations has left consumers reliant on state attorneys general and regulators for assistance with complaints.
The proposed legislation in New York seeks to curb predatory practices by auto lenders, mortgage servicers, student loan providers, and car dealerships. It also aims to eliminate excessive fees, protect non-English speakers from exploitation, and ensure fair treatment for all consumers. Former CFPB Director Rohit Chopra and ex-FTC Chair Lina Khan have voiced their support for the bill, emphasizing the need for stronger state laws to protect consumers and businesses alike.
In a statement, Chopra highlighted the importance of passing robust consumer protection measures to safeguard the financial well-being and privacy of New Yorkers. Khan echoed this sentiment, emphasizing the role of state lawmakers in empowering Attorney General James to uphold the economic freedoms of the state’s residents. As the fate of the CFPB remains uncertain, the FAIR Business Practices Act represents a critical step towards ensuring consumer protection and accountability in New York.
