Another COJ Bill In New York Added To The Pile
Three members of the New York State Assembly want to make it illegal for a confession of judgment to be entered in the state against non-New York debtors. The debtor would also be required to be a resident of the county in which the COJ is filed. The authors behind Bill A07500, introduced on May 7th, plainly state that it is a reaction to stories that were published in Bloomberg Businessweek. (Questionable stories at that: See deBanked coverage)
“This measure is in response to recent press reports regarding creditors that execute confessions of judgment in New York State even though the associated agreement or debtor have no nexus to the State,” a memo attached to the bill states. Sign Here to Lose Everything, the Businessweek series authored by Zachary R. Mider and Zeke Faux, are cited in the footnotes.
The measure is merely the latest weapon unveiled in a wave of proposed legislation aimed at small business financing in New York this year. Here’s a recap of what’s pending now:
- A07500 – Seeks to ban COJs being entered against non-New York debtors.
- A03636 – Seeks to ban COJs from financial contracts.
- A03637 – Seeks to classify merchant cash advances as loans.
- A03646 – Seeks to establish a task force to investigate New York City marshals and their connection to “predatory lenders” and consider the feasibility of abolishing the city marshal program.
- A03638 – Seeks to apply consumer usury protections to small businesses.