Cuomo Signs Bill Cracking Down on Small-Business-Loan Abuses
- Ban on out-of-state confessions of judgment has national scope
- Law will restrict use by unregulated cash-advance lenders
New York Governor Andrew Cuomo
Photographer: Drew Angerer/Getty Images
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New York Governor Andrew Cuomo signed a bill aimed at preventing predatory lenders from using the state’s court system to seize the assets of small businesses nationwide.
The new law prohibits the use of confessions of judgment against individuals and businesses located outside of the state. A series of Bloomberg News articles over the past year about abuses of these legal documents revealed more than 32,000 filed in New York courts by unregulated lenders, mostly against borrowers outside of the state.