Attorney General James Takes Action to Protect New York Consumers and Small Businesses 

NEW YORK – New York Attorney General Letitia James today advanced new legislation to protect consumers and small businesses from unfair, deceptive, and abusive practices. The Fostering Affordability and Integrity through Reasonable Business Practices, or FAIR Business Practices Act, is a program bill from the Office of the Attorney General (OAG) and championed in the state legislature by Senator Leroy Comrie and Assemblymember Micah Lasher. This legislation will strengthen New York’s consumer protection law, GBL §349, to protect New Yorkers from a wide array of scams, including deed theft, artificial intelligence (AI)-based schemes, online phishing scams, hard-to-cancel subscriptions, junk fees, data breaches, and other unfair, deceptive, and abusive practices. Forty-two other states and federal law already prohibit unfair practices, making New York’s current law both antiquated and inadequate. 

The FAIR Business Practices Act would also help stop lenders, including auto lenders, mortgage servicers, and student loan servicers, from deceptively steering people into higher cost loans. It would reduce unnecessary and hidden fees, stop unfair billing practices by health care companies, and prevent companies from taking advantage of New Yorkers with limited English proficiency. With the federal government rolling back protections for consumers and small businesses, the FAIR Business Practices Act authorizes OAG and victims to seek civil penalties and restitution against businesses that use unfair, deceptive, or abusive practices against vulnerable New Yorkers. 

“In New York right now, companies can make canceling a subscription so hard it seems impossible; nursing homeowners can sue relatives of deceased former residents; and debt collectors can steal Social Security benefits,” said Attorney General James. “This legislation will put a stop to this all. At a time when the federal government is making life harder, we want to make life easier for New Yorkers. The FAIR Business Practices Act will close loopholes that make it too easy for New Yorkers to be scammed, and will allow my office to go after anyone who violates the law and look forward to working with my partners in state government to ensure that as Washington retreats from protecting consumers, New York steps up to lead.” 

“With President Trump and co-president Elon Musk trying to shut down the Consumer Financial Protection Bureau, we need to fight back at the federal and local level,” said U.S. Senator Elizabeth Warren. “New York is leading the way, and I urge other states to protect Americans from getting tricked and trapped by big banks and giant corporations.”

“Strong consumer protection tools are essential for protecting Americans from unfair and abusive business practices,” said former FTC Chair Lina Khan. “At the FTC, we used these tools to tackle a range of exploitative tactics, from outrageous subscription traps and predatory scams to dangerous commercial surveillance. By passing a strong consumer protection bill, New York lawmakers can empower Attorney General James to fully defend New Yorkers' pocketbooks, privacy, and economic freedoms.”

“Businesses should compete by providing great products and superior service, not by devising schemes to rip people off,” said former CFPB Director and FTC Commissioner Rohit Chopra. “We need stronger state laws to combat abuses that harm families and honest businesses. With stronger laws on the books, Attorney General James and state law enforcement across the country can stop the scourge of junk fees and other crimes against consumers.”

“When unscrupulous actors take advantage of New Yorkers through online scams, junk fees, and hidden costs, our community and our economy suffer,” said Senator Leroy Comrie. “From unfair debt collection to deed theft, too many consumers have been hurt by abusive and deceptive practices. Let's get the FAIR Business Practices Act passed this year and put the power back in the hands of the people, ensuring that businesses play fairly and put New York on par with 47 other states that already have these protections. I’m proud to work alongside Assemblyman Micah Lasher and Attorney General Letitia James to bring much-needed protections to the people who need them most.”

“Consumer protection equals affordability. Every year, billions of hard-earned dollars are extracted from American consumers by companies, big and small, that take advantage of us,” said Assemblymember Micah Lasher. “And as we speak, Donald Trump, who ran on the issue of affordability, is turning the lights off at the Federal agencies responsible for protecting our pocketbooks. The news today is that New York is going to fight back with the FAIR Business Practices Act. Making sure that the Attorney General has the tools she needs to look out for New Yorkers is one of the best ways we can stop the damage Trump is trying to do. By passing this bill, we will protect consumers from the high costs of unfair business practices and make sure they can spend the money they earn on the things they need. It is an honor to stand together in this fight with Attorney General James, who is a beacon for New York and for the nation in this moment of darkness, and with Senator Comrie, who has taught me a great deal over many years about combining conviction and common sense to deliver for constituents.”

New York’s current consumer protection law, GBL §349, was passed in 1970 and only prohibits deceptive business acts and practices, leaving consumers vulnerable to unfair or abusive acts by companies. The FAIR Business Practices Act will protect New Yorkers from unfair and abusive business acts, such as: 

• Companies that make it difficult for consumers to cancel a subscription;
• Student loan servicers that steer borrowers into the most expensive repayment plans;
• Car dealers that refuse to return a customer’s photo ID until a deal is finalized and charge for add-on warranties that the customer did not actually purchase;
• Nursing homes that routinely sue relatives of deceased residents for their unpaid bills despite not having any basis for liability;
• Companies that take advantage of consumers with limited English proficiency and obscure pricing information and fees;
• Debt collectors that collect and refuse to return a senior’s Social Security benefits, even though they are exempt from debt collection; and
• Health insurance companies’ that use long lists of in-network doctors who turn out not to accept the insurance.

On February 9, the Trump administration ordered the Consumer Financial Protection Bureau (CFPB) to stop all work protecting consumers and decline any new cases. The CFPB is an independent agency that oversees big banks, lenders, credit card companies, and mortgage servicers and ensures companies are following federal consumer protection laws. As a result of the Trump administration's actions, the nation's largest banks are no longer being closely watched for compliance with key consumer protections by any federal regulator. The administration’s efforts to destroy the CFPB could also prevent consumers from reporting issues of fraud or deception. 

“For months, I battled my student loan servicer over errors that delayed my payments, cost me critical progress toward loan forgiveness, and left me in financial limbo—all with no clear explanation or accountability,” said Erik Krause, a student loan borrower. “My case is just one of many. Too often, consumers are left vulnerable to mismanagement from financial institutions with little recourse. The legislation advanced by Attorney General James and the bill sponsors will change that, ensuring real protections for millions of New Yorkers against these unfair and harmful practices.”

“Nearly every one of the small business clients I advise has had some experience with predatory lenders,” said Eda Henries, Founder & Managing Principal of Henries and Co. in Brooklyn. “This is the case because traditional banks have largely exited the small business lending space, meaning that when a small business owner needs capital they often turn to non-traditional lenders that can offer quick turnarounds on underwriting and disbursing a loan. But the flip side of that is these loans come with hidden interest rates that are very high and extremely onerous repayment terms. What may look like growth funding or growth capital often ends up being a debt trap. New York must stop allowing bad actors in the lending space to act without guardrails and should provide small businesses with more meaningful protections from abusive practices by these lenders, vendors, and other predatory businesses. That is why I support Attorney General James’ efforts to advance the FAIR Business Practices Act.”

“I am a co-op owner and up to date on my mortgage,” said Richard Barrett, a senior homeowner in Harlem. “Last year my mortgage servicer – a company I never even chose to do business with – improperly paid my entire building’s property taxes and is demanding that I reimburse them even though they are entitled to a refund from the City. I believe this practice is unfair and abusive and that Attorney General James’ FAIR Act would incentivize the company to fix the problem it created, instead of taking advantage of New Yorkers due to New York’s weak consumer protection laws.”

“New York once stood as a model of consumer protection, but over time has fallen behind most other states in this regard,” said Carolyn Carter, Deputy Director of the National Consumer Law Center. “New Yorkers are especially vulnerable in this moment as our strongest line of defense – the Consumer Financial Protection Bureau and Federal Trade Commission – are being eroded, and there are no state-level protections in New York against unfair and abusive market conduct. From large financial transactions such as student loan borrowing and auto sales to the everyday "subscription" economy, we see consumers fall victim to nefarious business practices without the ability for redress. NCLC applauds the Attorney General, Senator Comrie, and Assemblyman Lasher for championing the Fair Business Practices Act which will again make New York a leader in general consumer protection laws and promote a fairer economy for all.”

“All too often we see seniors and their families fall victim to predatory business practices such as unfair debt collection by nursing homes, home repair scams, and financial exploitation,” said Karen Nicolson, CEO and Executive Director of the Center for Elder Law and Justice. “Our attorneys work tirelessly to help secure redress for our clients, but New York's weak general consumer protection law – which notably does not ban unfair or abusive business activity – limits our ability to secure restitution. We applaud Attorney General James, Senator Comrie, and Assemblymember Lasher for championing the FAIR Business Practices Act which will better protect aging New Yorkers from nefarious marketplace conduct, hold bad actors accountable, and ensure that victims will be made whole.”

“Every single day we hear from older adults who have been victims of scams,” said Ann Marie Cook, President and CEO of Lifespan of Greater Rochester. “Scams are serious crimes that, at a minimum, disrupt a person’s life and usually impact their financial future for a long time. At Lifespan we work to educate older adults, protect them against unscrupulous people, and help them if they have been scammed. I want to sincerely thank Attorney General Letitia James for her leadership on this issue and for protecting all consumers from deceptive practices.” 

New Yorkers, especially seniors, veterans, low-income New Yorkers, and immigrant communities, are most vulnerable to these types of unfair, deceptive, or abusive practices. The FAIR Business Practices Act will authorize OAG and impacted individuals to bring a civil case against individuals or companies that engage in unfair, deceptive, or abusive practices to seek penalties and restitution. This legislation has been introduced in the State Senate and State Assembly, and Attorney General James will work to have it advanced and signed into law so New York consumers are better protected regardless of what happens on the federal level.