This is a status report provided by the New Jersey State Bar Association on recently passed and pending legislation, regulations, gubernatorial nominations and/or appointments of interest to lawyers, as well as the involvement of the NJSBA as amicus in appellate court matters. To learn more, visit njsba.com.
The New Jersey State Bar Association testified before the Assembly Consumer Affairs Committee last week to raise concerns about A1739 (McKeon)/S2989 (Pou), which would make certain for-profit debt adjusters eligible for licensing to conduct business in the state. The NJSBA opposes the bill, which was up for discussion only and was not posted for a vote in the committee.
“The bill would open the door to abuses that are widespread in the states that permit for-profit debt adjustment,” the NJSBA said in a statement to the committee. Consumer Protection Law Chair Yongmoon Kim and member Ronald LeVine testified on NJSBA’s behalf.
The bill would permit the licensing of for-profit debt adjusters, who market themselves as being able to reduce debt obligations to consumers. The NJSBA pointed out that such services are within reach of consumers, who can do this on their own. The services are also currently provided by non-profit credit counseling agencies and attorneys providing ancillary services for clients, both of which are governed by New Jersey’s Debt Adjusters Act to protect consumers from abuse. The statute limits fees for these services and mandates reporting requirements for nonprofit social service agencies of a nonprofit consumer credit counseling agency, as well as a bond.
“New Jersey’s most vulnerable consumers do not need for-profit companies to make their difficult roads even more fraught with danger, while inducing them to pay money they do not have to spare for the privilege,” the NJSBA said. It pointed out that federal laws also offer protections to those who face financial difficulties, including the bankruptcy code. NJSBA pointed out that bankruptcy may prove to be a viable solution for many of these consumers, who would likely not be counseled to undertake such services.
The NJSBA issued a statement against this bill in 2019 when it was last up in committee. It continues to monitor this bill in the current session.
Assembly Committee Considers Bill Modernizing Business Filings
Last week, the Assembly Financial Institutions and Insurance Committee passed A4341(Freiman)/S142 (Diegnan), which modernizes business filing statutes to include entity conversion and domestication. The NJSBA has long supported the passage of this bill.
“The bill would modify applicable business filing statutes in the New Jersey Business Corporation Act to add domestication and conversion provisions across all business types,” the NJSBA said. “The bill would align New Jersey with many other states that allow entity conversion and domestication, which will ultimately be a positive measure in making New Jersey a more business-friendly State.”
The bill passed the Senate and heads to the full Assembly for a vote before heading to the governor for his signature. The NJSBA continues to monitor the bill’s progress.