On June 9, New York City Comptroller Brad Lander issued a report highlighting the ways in which New York State policymakers can strengthen consumer financial protections for New York citizens. Specifically, the report advocated for statutory and regulatory changes that would address “gaps in city and state consumer financial protection policy,” including prohibiting unfair and abusive acts or practices; establishing a statewide “Consumer Protection Restitution Fund”; limiting overdraft and nonsufficient fund (NSF) fees; increasing oversight of products such as earned wage access (EWA), rent-to-own contracts, litigation advances, and merchant cash advances; enacting certain consumer privacy rights; and establishing a statewide consumer complaint database.

The report identified five areas where state and city intervention may be necessary: (i) closing regulatory and enforcement gaps; (ii) increasing banking access and affordability; (iii) regulating emerging fintech products; (iv) updating privacy laws to strengthen consumer data rights; and (v) increasing consumer outreach and education. The report contended that New York’s consumer protection statute, N.Y. General Business Law § 349, is “among the weakest consumer protection statutes in the country,” and recommended passing the FAIR Business Practices Act to address these gaps (covered by InfoBytes here). Additionally, the report suggested adopting NYDFS’ proposed rules to limit overdraft and NSF fees.

The report also called for the passage of the End Loansharking Act to regulate EWA products, rent-to-own contracts, and merchant cash advances under state lending laws. The report recommended that any legislation addressing these products should go beyond just licensing and should instead include consumer protections. The report also advocated for updating New York’s privacy laws to enhance consumer rights over personal data, following models from states like California and Oregon. Finally, the report recommended establishing a statewide or citywide public consumer complaint database to maintain transparency and accountability should the CFPB’s own database cease to operate.