Collectors and Process Servers Impacted by New Regulations in New York

The New York City Council adopted and published a new set of rules governing Debt Collectors that became effective April 24, 2010.

These new rules were promulgated by the same body that took on Sewer Service in New York that resulted in arguably the strictest regulations on private process servers in the United States.

Normally I would not write about rules effecting the collectors in New York, but these rules among other things place strict requirements on the collectors to maintain records of the activities of the process servers they contract with.

The following are the relevant sections of the new rules in New York City that will have an impact of process servers that work for debt collectors covered by these rules:

(3) A record of all cases filed in court to collect a debt. Such record shall include, for each case filed, the name of the consumer, the identity of the originating creditor, the amount claimed to be due, the civil court index number and the court and county where the case is filed, the date the case was filed, the name of the process server who served process on the consumer, the date, location and method of service of process, the affidavit of service that was filed and the disposition for each case filed. Such record shall be filed in a manner that is searchable or retrievable by the name, address and zip code of the consumer and the creditors who originated the debts that the debt collection agency is seeking to collect.

(4) The original copy of each contract with a process server for the service of process, and copies of all documents involving traverse hearings relating to cases filed by or on behalf of the debt collection agency. Such records should be filed in a manner that is searchable by the name of the process server.

The entire rules can be found at the following link: http://www.nyc.gov/html/dca/downloads/pdf/debt_collection_agency_law_rules.pdf

Electronic Subpoena System to replace cumbersome hand delivery of 100,000 paper subpoenas

Louisville Metro police have signed a $454,000 contract to adopt an Electronic Subpoena System to replace the county's cumbersome system of hand-delivering 100,000 paper subpoenas annually and help make sure officers show up for court.

“Everybody's going to benefit from this,” especially police, said Bruce McMichael of the Louisville Metro Criminal Justice Commission.

Metro Police Lt. Col. Vince Robison, responsible for overseeing court attendance, said the department is “very optimistic this will help us eliminate” the problem of officers missing court.

In recent years, an estimated 10 percent of the approximately 100,000 paper subpoenas issued annually to Louisville police never reached the officers, according to department officials. They and others cite the process as one reason why officers miss court. More on this story can be found here.

For those of you following my Blog you know this is the second major instance where government has deployed this type of solution to deal with the challenges associated with physical paper service of process.

I suspect this is just the beginning of things to come...

New York AG Shuts Down Another Process Serving Agency

The NY state Attorney General’s office has shut down a process server company that repeatedly claimed in legal affidavits that its employees had made proper service of legal documents to thousands of consumers when in fact it had not.


The Attorney General Office entered into a settlement requiring Brockport-based We Serve It For You Process Serving Agency, LLC, operated by Joanne Marie Coy, John Coy, Theresa Buehler, and Wesley Converse, to immediately cease operations and cooperate with ongoing investigations. The business and its owners must also pay fees, costs, and penalties totaling $10,000 and John Coy must surrender his notary public commission.

The AG’s office began investigating We Serve It For You in 2009 as part of an ongoing probe into debt collection lawsuits.

“The toxic business practices of this company impacted individuals across New York State,” said Attorney General Andrew Cuomo. “People need to have trust in the legal system, and that’s why we are banning this company and its owners from serving legal documents to the people of New York.”

The Attorney General’s investigation determined that those documents were regularly signed and mailed to John Coy, who would notarize them without witnessing the signature. From 2007 to 2009, We Serve It For You served approximately 54,000 complaints and maintained a database detailing each service. The Attorney General’s Office and the Unified Court System determined that:

On more than 1,100 occasions, We Serve It For You process servers claimed to have made service or service attempts at two or more places at the same time.

On more than 700 occasions, We Serve It For You process servers claimed to have made service or service attempts before they even received the documents to serve.

On tens of thousands of occasions, John Coy notarized the signatures of We Serve It For You process servers when he did not witness the signatures.

Through the agreement with Attorney General’s Office, We Serve It For You and its operators are permanently barred from having any legal or beneficial interest in any business involving the delivery or service of legal documents. The business will permanently cease all activities and dissolve.

We Serve It For You and its operators are also required to cooperate with the Attorney General’s ongoing investigations into illegal debt collection practices.

The settlement follows recent action against another process server, American Legal Process (ALP), which engaged in a similar fraud and caused more than 100,000 consumers to have costly judgments entered against them without the chance to respond or defend themselves in court. Aside from a civil suit and criminal prosecution against the owner of ALP, Cuomo’s office is seeking to have more than 100,000 default judgments that were caused by the faulty service overturned.

The NY AG Press Release can be found here