The New York City Council - File #: Int 0052-2018

• File #: Int 0052-2018
• Version: *
• Name: Banning companies that charge a fee for “student debt relief” already provided by the federal government.
• Type: Introduction
• Status: Committee
• File created: 1/31/2018
• In control: Committee on Consumer Affairs and Business Licensing
• On agenda: 1/31/2018
• Title: A Local Law to amend the administrative code of the city of New York, in relation to banning companies that charge a fee for "student debt relief" already provided by the federal government and creating a private cause of action for borrowers who fall victim to these scams
• Sponsors: Robert E. Cornegy, Jr., Justin L. Brannan, Helen K. Rosenthal
• Indexes: Agency Rule-making Required

Date	Ver.	Action By	Action	Result
1/31/2018	*	City Council	Referred to Comm by Council
1/31/2018	*	City Council	Introduced by Council

Int. No. 52

By Council Members Cornegy, Brannan and Rosenthal

title
A Local Law to amend the administrative code of the city of New York, in relation to banning companies that charge a fee for "student debt relief" already provided by the federal government and creating a private cause of action for borrowers who fall victim to these scams
Body

Be it enacted by the Council as follows:


Section 1. Chapter 5 of title 20 of the administrative code of the city of New York is amended by adding a new subchapter 20 to read as follows:
SUBCHAPTER 20
PROHIBITION ON STUDENT DEBT RELIEF SERVICES REGARDING FEDERAL LOANS FOR A FEE
? 20-828 a. No person shall offer or advertise student debt relief services regarding federal student loans for a fee where such services are offered for free by the federal department of education.
b. This law does not apply to persons who, before providing such services, provide to customers written disclosures that contain the following information:
1. A statement informing customers that the federal department of education provides free assistance to holders of federal loans, including:
(a) Lowering or capping monthly payments;
(b) Checking eligibility for loan forgiveness;
(c) Consolidating federal loans; and
(d) Giving advice on getting out of default.
2. Contact information for the federal student aid information center, including:
(a) The phone number; and
(b) The website URL.
? 20-825 Penalties. Any person that violates 20-824 is liable for a civil penalty of not less than $500 or more than $2,000 for the first violation and a civil penalty of not less than $800 or more than $3,000 for each succeeding violation.
? 20-826 Civil cause of action. Any person claiming to have been harmed by a person offering student debt relief services for a fee has a cause of action against such person in any court of competent jurisdiction for compensa...