At a recent press conference held at the Attorney General’s office in New York City on January 8, 2025, Letitia James, the New York Attorney General, made a significant announcement. She proposed a new bill aimed at shielding consumers and small businesses across the state from scams and deceptive practices orchestrated by various lenders, debt collectors, and healthcare providers.
Letitia James explained that this legislation is designed to strengthen the existing consumer protection laws in New York, which have been in place since 1970 but are considered somewhat outmoded. She highlighted how necessary this enhancement has become, especially now when the Trump administration seems to have weakened the Federal Consumer Financial Protection Bureau (CFPB), the principal agency tasked with consumer protection.
The proposed legislation, named the Fostering Affordability and Integrity through Reasonable Business Act, received backing from notable state legislators, including Senator Leroy Comrie and Assemblymember Micah Lasher. James pointed out several issues plaguing New York residents: arduous subscription cancellations, the possibility of nursing homeowners suing relatives of deceased former residents, and debt collectors unlawfully taking social security benefits, to name a few. “The FAIR Business Practices Act is our approach to closing these loopholes, ensuring New Yorkers aren’t easily scammed, and empowering my office to hold law violators accountable,” James stated emphatically.
This initiative by New York is among the pioneering efforts by state officials to counteract the reduced efficacy of the CFPB. Since Russell Vought took over as the Acting Director of the CFPB last month, a massive restructuring has resulted in the dismissal of about 200 employees, with the remaining staff being instructed to significantly reduce their activities. Further mass layoffs were planned by Vought in conjunction with Elon Musk’s Department of Government Efficiency but were halted by a federal judge’s intervention, as per reports from current employees.
What lies ahead for the CFPB remains uncertain, leaving consumers to turn to state attorneys general and regulators to address grievances. The proposed law in New York aims to curb exploitative practices by automotive lenders, mortgage services, and student loan providers, while also working to eliminate unnecessary fees and unethical actions by car dealerships. Additionally, it seeks to safeguard non-English speakers from exploitation.
The bill received endorsements from two prominent regulators from former President Joe Biden’s era: Rohit Chopra, the ex-director of the CFPB, and Lina Khan, former FTC Chair. “We need tougher state laws to battle against the abuses targeting families and honest businesses,” Chopra noted in his statement. Echoing support, Khan added, “By enacting robust consumer protection laws, New York legislators can empower Attorney General James to effectively safeguard the economic interests, privacy, and freedoms of New Yorkers.”
