Council Seeks Regulation of Debt Collectors

The City Council is seeking new regulations on debt collection agencies following a report by the Urban Justice Center suggesting that 42% of city debt cases were brought to court by unlicensed debt collectors. Under legislation introduced yesterday by council members Dan Garodnick and Leroy Comrie, all debt collectors who operate in the city would have to register with the Department of Consumer Affairs.

"Unlicensed debt collectors are clogging the courts and preying on consumers," Mr. Garodnick said yesterday in a statement.

According to Mr. Garodnick, consumers faced with lawsuits from unregistered collectors often have difficulty discovering the source of their debt and can't reach collection agencies with their questions. Registered collectors, however, can be contacted through the DCA, and their collection methods must be approved by the city.