Predatory Lending Tactic Curbed by Three New York County Clerks
- Erie, Orange and Richmond rejecting confessions of judgment
- The moves are disrupting a nationwide loan-collection system
This article is for subscribers only.
At least three New York State county clerks have taken actions to curtail the use of an aggressive loan-collection tactic known as a confession of judgment, disrupting a system that ensnares thousands of small businesses across the country.
Clerks in Erie, Orange and Richmond counties stopped processing most confessions in recent weeks, after Bloomberg News reported on abuses by companies that advance money to businesses and as state and federal legislators called for an end to the practice. Together, the three counties had been handling almost half of the industry’s caseload.