On January 27, 2021, New York State Senators Jeffrey Dinowitz and Michael Benedetto introduced Assembly Bill A3525, an Act to amend the general business law and the banking law in relation to providing for budget planning and debt settlement services. AB A3525 was referred to the Consumer Affairs and Protection Committee. When a bill is referred to a Committee, members will evaluate the bill and decide whether to “report” it (send it) to the Senate floor for a final decision by the full membership. 

AB A3525 is amending the already established New York Budget Planning Law by making it more clear that debt settlement services are not to be included in the State’s definition of “Budget Planning services.” As included from the Bill: “provided, however, that ‘budget planning’ does not include ‘debt settlement services’ as defined in  section five hundred eighty-eight-a of the banking law.” AB A3525’s definition of a “Debt Settlement Company” “means any person: (A) engaging in, or holding himself, herself, or itself out as  engaging  in,  the business of providing debt settlement services in exchange for or in expectation of any compensation or gain; or (B) soliciting for or acting on behalf of any person engaging in, or holding  himself, herself, or itself out as engaging in, the business of providing debt settlement services in exchange for or in expectation of any compensation or gain.”

As it stands, AB A3525 delineates debt settlement services, both negotiators and solicitors of debt settlement services, from budget planners and makes it a point to separate them from being impacted by this bill. We will continue to update you on the trajectory of this bill through the New York Legislature.