New York State Senator Rob Ortt has sponsored S03911A, which would cap the interest rate for the consumer litigation lending industry at 16 percent, which is New York’s civil usury cap, writes the New York Law Journal.
In February, New York state Attorney General Eric Schneiderman sued RD Legal Funding and its founder over allegations that the litigation funding company scammed ill 9/11 responders and National Football League players suffering from concussion-related injuries. The lawsuit claimed that RD Legal charged annual interest rates as high as 250 percent and collected millions of dollars in interest and fees.
“To end the abuse and predatory practices, these lenders should be subject to consumer protection laws just like every other financial institution. Injured New Yorkers cannot continue to be victimized by these legal loan sharks,” said Tom Stebbins, executive director of the Lawsuit Reform Alliance of New York.