According to a press release issued by New York’s Department of Financial Services, the state’s debt collectors have been warned that it’s illegal to collect on payday loans in that state, since payday loans are illegal. Governor Andrew Cuomo was quoted as saying, “Studies clearly show that payday loans are not a solution for people with low incomes, but rather a high cost debt trap. That’s why they are illegal in New York, and the State will continue to protect consumers from these misleading loans.”

The release noted that, although payday lenders try and skirt the law by offering payday loans over the Internet, those loans are still illegal in New York. According to Superintendent of Financial Services Benjamin Lawsky, “All debt collectors in New York should know that it is illegal to try to collect payday loan debts. We will aggressively enforce the law to protect all New Yorkers and especially low income individuals who are all too often abused by unscrupulous lenders and debt collectors.”

Like this post? Subscribe to my RSS feed and get loads more!