Section 20-723
§ 20-723 Representations in advertising. No person, firm, corporation
or association, or agent or employee thereof, doing business in New York
city, who with intent to sell or in any way dispose of merchandise to
the public through the media of a newspaper, magazine, circular,
pamphlet, catalogue, store display, letter or handbill shall advertise,
state, set forth, print, publish or cause directly or indirectly or
permit directly or indirectly, so to be done in any of the aforesaid
media, any of the following or anything approximating any of the
following:
(a) That the merchandise offered as aforesaid is being offered at
"wholesale price" or at "manufacturers' cost" or "less than cost" or any
similar language, unless such representations are true in fact; nor
shall any such person, firm or corporation or association, or agent or
employee thereof, doing business in New York city, offer for sale any
product at a price purported to be reduced from what is a fictitious
"list" or "selling" or "retailer's suggested" price, or at a purported
reduction in any such price when such purported reduction is in fact
fictitious.
(b) That the merchandise offered as aforesaid is being offered on the
basis of comparative prices or percentage savings, or similar or
analogous claims by the use of such terms as "comparable value" or
"comparable retail value," without denoting, defining or describing the
standard of comparison.
(c) That the merchandise offered as aforesaid is being offered as
"made to sell for", or being "worth" or "valued at," a certain price
greater or more than the price sought, or by the use of similar or
analogous statements unless such claim or representation is true in
fact.
Section 20-723.1.
§ 20-723.1. Advertising Disclosure Requirements for Lenders Promoting
Payday Loan Services.
a. Definitions. For purposes of this section:
(1) "Payday loan", also known as, among other terms, "deferred deposit
advances," "cash on demand" or "cash advance," shall mean any
transaction in which funds are provided to a consumer for a limited time
period in exchange for (i) a consumer's personal check or share draft,
in the amount of the funds provided to the consumer plus a fee, where
presentment or negotiation of such check or share draft is deferred by
agreement of the parties until a designated future date; or (ii) a
consumer's authorization to debit the consumer's transaction account, in
the amount of the funds provided to the consumer plus a fee, where such
account will be debited on or after a designated future date.
(2) "Unit of advertising space" shall mean any real property, space,
facility or instrumentality, or any portion thereof, owned or operated
by the city of New York, or which is located or operates on real
property owned or operated by the city of New York, and which is the
subject of the same contract, lease, rental agreement, franchise,
revocable consent, concession or other similar written agreement with
the city of New York which allows the placement or display of
advertisements, but not including any real property, space or facility
leased from the city of New York for a term of thirty years or more
during the entire term of the lease or any real property, space or
facility leased from or to the industrial development agency.
b. Any lender, bank or other financial institution that provides
payday loan or grant services and which promotes its payday loan or
grant services, however described or designated, via a unit or units of
advertising space, and which, because of the application of other state
or federal law, is exempt from the fee limitations of New York state,
and charge interest, fees and other charges greater than those
authorized in New York state, shall comply with the following disclosure
requirements with respect to a unit or units of advertising space:
Advertisements shall disclose, in clear and prominent letter type, in
a print color that contrasts with the background against which it
appears, of at least a 20-point type size:
i. the maximum annual percentage rates (APR) of the institution's
payday loans, computed in accordance with regulations adopted pursuant
to the federal Truth-in-Lending Act; and
ii. any membership fees, finance charges, annual fees, transaction
fees, rollover costs, lender's fees or any other possible charges that
may be incurred by a consumer in relation to the institution's payday
loans, including any interest, fees and other charges due at the time of
any loan renewal;
iii. the state in which the lender/financial institution is chartered;
iv. the fact that the consumer will be required to supply personal
information to receive the institution's payday loan, including
information regarding his or her personal financial history;
v. the fact that a fee schedule for all charges related to the
institution's payday loans will be available upon request;
vi. a contact number, such as the New York state banking department's
Consumer Hotline, where a consumer/applicant can direct complaints
against the lender/financial institution;
vii. the name of the lender/financial institution offering the payday
loan.
c. Any person who is a party to an otherwise valid agreement with the
city of New York in effect on the date of enactment of the local law
that added this section shall not be subject to the requirements of this
section for the term of such agreement. However, where such agreement
provides for a right or rights of renewal for one or more periods upon
the same terms and conditions or terms and conditions set forth in such
agreement, the holder who is a party to such agreement or any agreements
entered into pursuant to such right or rights of renewal shall be
subject to the requirements of this section at the commencement of the
first renewal period.
d. (1) Notwithstanding any other provision of law, the department
shall be authorized upon due notice and hearing, to impose civil
penalties for the violation of any provision of this section. The
department shall have the power to render decisions and orders and to
impose civil penalties not to exceed the amounts specified in section
20-726 of this subchapter for each such violation. All proceedings
authorized pursuant to this paragraph shall be conducted in accordance
with rules promulgated by the commissioner. The remedies and penalties
provided for in this paragraph shall be in addition to any other
remedies or penalties provided for the enforcement of such provisions
under any other law including, but not limited to, civil or criminal
actions or proceedings.
(2) All such proceedings shall be commenced by the service of a notice
of violation returnable to the administrative tribunal of the
department. The commissioner shall prescribe the form and wording of
notices of violation. The notice of violation or copy thereof when
filled in and served shall constitute notice of the violation charged,
and, if sworn to or affirmed, shall be prima facie evidence of the facts
contained therein.
Section 20-723.2.
§ 20-723.2. Disclosure Requirements for Businesses Promoting Credit
Counseling Services.
a. Definitions. For purposes of this section:
(1) "Credit counselor" shall mean any person, partnership, firm,
corporation or business entity advertising, promoting, or offering the
type or category of credit counseling services required to be received
as a pre-condition for filing a petition for bankruptcy under the
Bankruptcy Abuse Prevention and Consumer Protection Act of 2005,
including, but not limited to, consideration of alternatives to resolve
a client's credit problems and an analysis of the client's budget,
current financial condition, factors that caused such financial
condition, and how such client can develop a plan to respond to the
problems without incurring negative amortization of debt.
(2) "Approved credit counselor" shall mean a credit counselor listed
in the directory of authorized nonprofit budget and credit counseling
service providers promulgated pursuant to the Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005.
b. (1) Any person, partnership, firm, corporation or business entity
promoting or offering the services of a credit counselor,
notwithstanding whether such person, partnership, firm, corporation or
business entity accepts a fee for such services, shall provide written
notice to any potential or actual consumer when such person,
partnership, corporation, firm or business is not an approved credit
counselor.
(2) Such notice, to be signed by any potential or actual consumer,
shall include, but not be limited to, the following provisions:
i. that the federal Bankruptcy Abuse Prevention and Consumer
Protection Act of 2005 created an approval process for nonprofit budget
and credit counseling agencies that provide an evaluation of your
current financial situation, a discussion on alternatives to bankruptcy
and a personal budget plan;
ii. that to be approved by the United States Trustee and added to the
directory of approved credit counselors, a credit counselor must
satisfactorily demonstrate compliance with the requirements of the
Bankruptcy Abuse Prevention and Consumer Protection Act of 2005;
iii. that such credit counselor is not approved to offer bankruptcy
counseling services pursuant to the Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005;
iv. that a consumer of a credit counselor may contact the United
States department of justice or the clerk of the United States
bankruptcy court for the southern and eastern districts of New York for
a list of credit counselors approved pursuant to the Bankruptcy Abuse
Prevention and Consumer Protection Act of 2005, if such consumer is
considering filing a bankruptcy petition;
v. that a consumer of a credit counselor is not required to obtain a
loan or enter into a contract for debt repayment with any specific
credit counselor; and
vi. such other provisions as the department may deem appropriate.
c. Any person, partnership, firm, corporation or business entity that
holds itself out to the public in printed, televised, or radio media as
providing the services of a credit counselor but is not an approved
credit counselor shall disclose in such media that it is not an approved
credit counselor pursuant to the Bankruptcy Abuse Prevention and
Consumer Protection Act of 2005.
* d. (1) Notwithstanding any other provision of law, the department
shall be authorized upon due notice and hearing, to impose civil
penalties for the violation of any provision of this section. The
department shall have the power to render decisions and orders and to
impose civil penalties of not less than two thousand five hundred
dollars nor more than five thousand dollars for each violation. All
proceedings authorized pursuant to this paragraph shall be conducted in
accordance with rules promulgated by the commissioner. The remedies and
penalties provided for in this paragraph shall be in addition to any
other remedies or penalties provided for the enforcement of such
provisions under any other law including, but not limited to, civil or
criminal actions or proceedings.
(2) All such proceedings shall be commenced by the service of a notice
of violation returnable to the administrative tribunal of the
department. The commissioner shall prescribe the form and wording of
notices of violation. The notice of violation or copy thereof shall
constitute notice of the violation charged, and, if sworn to or
affirmed, shall be prima facie evidence of the facts contained therein.
* NB There are 2 sb d's
* d. The commissioner shall conspicuously disclose on its web site all
persons, partnerships, firms, corporations or business entities that
have been found to have violated any provisions of this section, or
rules and regulations promulgated hereunder, within the preceding twelve
months. Such disclosure shall, at minimum, list the name of each person,
partnership, firm, corporation or business entity found to have violated
any provisions of this section, or rules and regulations promulgated
hereunder, as well as the nature of each violation.
* NB There are 2 sb d's
Section 20-723.3
§ 20-723.3 Disclosure Requirements for Distressed Property
Consultants. a. Definitions. For the purposes of this section the
following terms shall have the following meanings:
1. "Consulting services" means services promised by a distressed
property consultant to a homeowner, including but not limited to
services that the consultant represents will help to achieve any of the
following:
i. An action to stop, enjoin, delay, set aside, annul, stay or
postpone a foreclosure filing, a foreclosure sale or the loss of a home
for nonpayment of taxes;
ii. A forbearance from any servicer, beneficiary or mortgagee or
relief with respect to the potential loss of the home for nonpayment of
taxes;
iii. The exercise of a right of reinstatement or similar right by the
homeowner as provided in the mortgage documents or any law or the
refinancing of a distressed home loan;
iv. Any extension of the period within which the homeowner may
reinstate or otherwise restore his or her rights with respect to the
property;
v. A waiver of an acceleration clause contained in any promissory note
or contract secured by a mortgage on a property in foreclosure;
vi. A loan or advance of funds;
vii. Assistance to the homeowner in answering or responding to a
summons and complaint, or otherwise providing information regarding the
foreclosure complaint and process;
viii. The avoidance or amelioration of the impairment of the
homeowner's credit resulting from the commencement of a foreclosure
proceeding or tax sale;
ix. The saving of the homeowner's property from foreclosure or loss
for nonpayment of taxes; or
x. Any other action as may be deemed subject to section 265-b of the
New York state general business law.
2. "Distressed home loan" means a home loan that is in danger of being
foreclosed because the homeowner has one or more defaults under the
mortgage that entitles the lender to accelerate full payment of the
mortgage and repossess the property, or a home loan where the lender has
commenced a foreclosure action. For purposes of this paragraph, a "home
loan" is a loan in which the debt is incurred by the homeowner, or
shareholder in a cooperative corporation, primarily for personal,
family, or household purposes, and the loan is secured by a mortgage or
deed of trust on property, or in the case of a cooperative by a security
agreement in shares in a corporation, upon which there is located or
there is to be located a structure or structures intended principally
for occupancy of from one to four families, which is or will be occupied
by the homeowner as the homeowner's principal dwelling.
3. "Distressed property consultant" means an individual or
corporation, partnership, limited liability company or other business
entity that, directly or indirectly, solicits or undertakes employment
to provide consulting services to a homeowner for compensation or
promise of compensation with respect to a distressed home loan or a
potential loss of the home for nonpayment of taxes, or any individual or
business entity considered a distressed property consultant for purposes
of New York state real property law section 265-b. A distressed property
consultant does not include the following:
i. An attorney admitted to practice in the State of New York;
ii. A person or entity who holds or is owed an obligation secured by a
lien on any property in foreclosure while the person or entity performs
services in connection with the obligation or lien;
iii. A bank, trust company, private banker, bank holding company,
savings bank, savings and loan association, thrift holding company,
credit union or insurance company organized under the laws of this
state, another state or the United States, or a subsidiary or affiliate
of such entity or a foreign banking corporation licensed by the
superintendent of banks or the comptroller of the currency;
iv. A federal Department of Housing and Urban Development approved
mortgagee and any subsidiary or affiliate of such mortgagee, and any
agent or employee of these persons while engaged in the business of such
mortgagee;
v. A judgment creditor of the homeowner, if the judgment creditor's
claim accrues before the written notice of foreclosure sale is sent;
vi. A title insurer authorized to do business in this state, while
performing title insurance and settlement services;
vii. A person licensed as a mortgage banker or registered as a
mortgage broker or registered as a mortgage loan servicer as defined in
article 12-d of the New York state banking law;
viii. A bona fide not-for-profit organization that offers counseling
or advice to homeowners in foreclosure or loan default; or
ix. A person or entity that the superintendent of banks has determined
is not subject to section 265-b of the New York state real property law.
4. "Homeowner" means a natural person who is the mortgagor with
respect to a distressed home loan or who is in danger of losing a home
for nonpayment of taxes.
5. "Unit of advertising space" means any real property, space,
facility or instrumentality, or any portion thereof, owned or operated
by the city of New York, or which is located or operates on real
property owned or operated by the city of New York, and which is the
subject of the same contract, lease, rental agreement, franchise,
revocable consent, concession or other similar written agreement with
the city of New York which allows the placement or display of
advertisements, but not including any real property, space or facility
leased from the city of New York for a term of thirty years or more
during the entire term of the lease or any real property, space or
facility leased from or to the industrial development agency.
b. Every distressed property consultant who does business in New York
City and who advertises distressed property consulting services through
the media of a newspaper, magazine, circular, pamphlet, store display,
letter or handbill and/or via a unit or units of advertising space,
shall disclose in such advertising, in accordance with the rules
established by the commissioner, in clear and prominent letter type, in
a print color that contrasts with the background against which it
appears:
1. that, pursuant to section 265-b of the New York state real property
law, a distressed property consultant is prohibited from:
i. performing services without a written, fully executed contract with
a homeowner;
ii. accepting payment for consulting services before the full
completion of such services;
iii. taking power of attorney from a homeowner; and
iv. retaining any original loan document or other original document
related to the distressed home loan, the property, or the potential loss
of the home for nonpayment of taxes.
2. that hiring a distressed property consultant does not stop the
foreclosure process, nor can a distressed property consultant guarantee
any particular result with regards to a distressed property.
c. The commissioner may make and promulgate such rules as may be
necessary for the proper implementation and enforcement of this section.
d. Any person who is a party to an otherwise valid agreement with the
city of New York in effect on the date of enactment of the local law
that added this section shall not be subject to the requirements of this
section for the term of such agreement. However, where such agreement
provides for a right or rights of renewal for one or more periods upon
the same terms and conditions or terms and conditions set forth in such
agreement, the holder who is a party to such agreement or any agreements
entered into pursuant to such right or rights of renewal shall be
subject to the requirements of this section at the commencement of the
first renewal period.
e. (1) Notwithstanding any other provision of law, the department
shall be authorized upon due notice and hearing, to impose civil
penalties for the violation of any provision of this section. The
department shall have the power to render decisions and orders and to
impose civil penalties of not less than two thousand five hundred
dollars nor more than five thousand dollars for each violation. All
proceedings authorized pursuant to this paragraph shall be conducted in
accordance with rules promulgated by the commissioner. The remedies and
penalties provided for in this paragraph shall be in addition to any
other remedies or penalties provided for the enforcement of such
provisions under any other law including, but not limited to, civil or
criminal actions or proceedings.
(2) All such proceedings shall be commenced by the service of a notice
of violation returnable to the administrative tribunal of the
department. The commissioner shall prescribe the form and wording of
notices of violation. The notice of violation or copy thereof shall
constitute notice of the violation charged, and, if sworn to or
affirmed, shall be prima facie evidence of the facts contained therein.
Section 20-724
§ 20-724 Requirements of records. Any such person, firm, corporation
or association or agent, or employee thereof, doing business in New York
city, making any one or more of the aforesaid statements, claims,
offers, or representations of the types described in subdivisions (a),
(b) and (c) of section 20-723 shall maintain full and adequate records
disclosing the facts upon which any such statements, offers, claims or
representations are based.
(a) All such records shall be open and available for inspection to the
commissioner or to his or her duly designated representatives for a
period of ninety days from the date of the offer.
(b) The failure of any such person, firm, corporation or association,
or agent or employee thereof doing business in New York city to produce
such records in substantiation of its claims shall be presumptive of the
falsity of the advertisement.
Section 20-725
§ 20-725 Rules and regulations. The commissioner may make and
promulgate such rules and regulations as may be necessary to carry out
the purposes of this subchapter.
Section 20-726
§ 20-726 Violations. Any person, firm, corporation or association or
agent or employee thereof, who shall violate any of the provisions of
this subchapter upon conviction thereof, shall be punished by a fine of
not more than five hundred dollars ($500) or by imprisonment not
exceeding thirty (30) days, or by both.
To the extent possible under law, Friends of Devin Balkind for Public Advocate has waived all copyright and related or neighboring rights to New York City Administrative Code. This work is published from: United States.
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