The New York City Department of Consumer Affairs (DCA) has issued a set of revisions to its debt collection rules that are intended to track consumer language preferences and apprise consumers of the availability of language services, either from the servicer or the DCA. These new requirements, which are effective as of October 1, 2020, affect recordkeeping, translation quality (should a collector decide to provide translations), the debt validation notice, and any public website maintained by the servicer. These changes are made to Title 6 of the Rules of the City of New York (RCNY). The particulars of these changes are outlined below, with specific citations for each new requirement. Please note that these revisions do not require the servicer to provide any new language services; if a servicer chooses to provide language services, it must inform the consumer of their availability and ensure their accuracy.
Language Preference Tracking and Annual Report
The following are additional recordkeeping burdens borne by the servicer.
- Servicers must make reasonable efforts to ascertain every consumer’s language preference and maintain a record of it. 6 RCNY § 2-193(b)(5).
- Servicers must prepare an annual report, using a form provided by the DCA, disclosing (1) the number of accounts on which non-English collection communications were made and (2) the number of employees that conducted these non-English collection communications. 6 RCNY § 2-193(c)(3). Please note that this annual report form does not appear to be available at this time.
Prohibition on Inaccurate or Incomplete Translations and Requirement to Disclose Language Preference
The following will now be included in the legal definition of “false, deceptive, or misleading” representations:
- Any “false, inaccurate, or partial” translation of a collection communication, if the servicer is providing the translation. Please note that the servicer is not required to provide translation services under this revision. However, should a servicer decide to do so, the translation must be complete and correct. 6 RCNY § 5-77(d)(18).
- Failure to accurately disclose a consumer’s known language preference when returning or selling an account, or when referring an account for litigation. 6 RCNY § 5-77(d)(18). Please note that our interpretation of this is that the next contact with any existing NYC consumer should include a request for their language preference. The first contact with any new consumer should also include this request, unless a prior servicer has already included the consumer’s language preference information in a transfer file.
In addition, the following will now be included in the legal definition of “unfair or unconscionable means” of collecting a debt:
- Attempting to collect a debt without first requesting the consumer’s language preference and keeping a record of it. 6 RCNY § 5-77(e)(9).
Additional Requirements for Debt Validation Notices and Public Websites
The following are additional statements which must now be included in the standard debt validation notice sent to any NYC consumer:
- A statement informing the consumer of any language services provided by the servicer, including whether the servicer will provide non-English translations of all communications. 6 RCNY § 5-77(f)(2)(vii). As noted above, the servicer is not required to provide translation services under this revision. However, should a servicer decide to do so, it must inform the consumer that these services are available.
- A statement that the consumer may find “translation and description” of common debt-collection terms, in multiple languages, on the DCA website: www.nyc.gov/dca. 6 RCNY § 5-77(f)(2)(viii).
These same two statements, regarding (1) language services provided by the servicer and (2) the glossary provided by the DCA, must be added “clearly and conspicuously” to any website maintained by the servicer that is accessible by the public. 6 RCNY § 5-77(h)(1)-(2). Note that since these rules only apply to New York City, it is our recommendation that such website disclosures clearly indicate that they are for NYC consumers only. The DCA has added a new penalty to its enforcement schedule for failure to comply with this new website requirement. The penalties match those for violation of the debt validation notice requirements: $260 for a first violation, $315 for a second violation, and $350 per any additional violation. 6 RCNY § 6-62. For any questions regarding this article, please contact Deborah Gallo, Director of Operations, as [email protected]