Law Will Require Distressed Property Consultants to Disclose Regulations in Advertisements

City Hall, October 28, 2009 – In response to a proliferation of unscrupulous foreclosed property consultants in New York City, the members of the City Council will vote on legislation requiring these businesses to disclose recently enacted state regulations on any printed advertisements. With increasing rates of foreclosures and loan defaults, the State passed regulatory laws in August 2008 prohibiting distressed property consultants from collecting any payment prior to the completion of services as well as prohibiting them from performing services without a written contract with the property owner. Currently, the city, in collaboration with several local not-for-profit organizations, already offer free and reduced-cost foreclosure prevention services.

The Council will also vote to adopt legislation that will:

· Require commuter van owners to display a passenger bill of rights;

· Increase penalties for leaving an idling vehicle unattended;

· Approve the mixed-use expansion of the Museum of Modern Art’s museum complex on West 53rd Street in Midtown Manhattan

· Approve a comprehensive 89-block rezoning in Brooklyn’s Carroll Gardens neighborhood.

The Council will also pass a resolution in support of congressional legislation that would increase community input surrounding Post Office closings and reorganization.


The aftermath of the sub-prime mortgage crisis has created an industry in which distressed property consultants help homeowners at risk of foreclosure negotiate with their lenders in exchange for a fee. Unfortunately, this industry has become rife with fraud, as con artists blanket hard-hit neighborhoods with posters offering assistance. They convince homeowners to pay money up front and then disappear, leaving these struggling New Yorkers in even more debt.

In an effort to combat such wide-spread fraud, New York State enacted a law in August 2008 regulating these services. To make sure homeowners are aware of their rights and protections, the Council will vote today to require these consultants to disclose the State regulations on any print advertisements.

Specifically, these advertisements would disclose that distressed property consultants are prohibited from:

Performing services without a written contract;
Accepting payment before the completion of such services;
Taking power of attorney from a homeowner; and
Retaining any original document related to the distressed home loan.

The consultants must also disclose that hiring a consultant does not stop the foreclosure process and a consultant cannot guarantee any specific results. Consultants failing to disclose this information on their advertisements could be fined between $2500 and $5000 for each violation. The Council is working in coordination with the State Attorney General’s office to identify fraudulent distressed housing consultants.

“Preying on desperate New Yorkers who are in danger of losing their homes is simply deplorable,” said Speaker Quinn. “It not only devastates these already struggling families, it also threatens to further destabilize neighborhoods hit hardest by foreclosures. With this legislation, we’ll have another key enforcement tool to keep these criminals from posting misleading advertisements and tricking New Yorkers out of their hard earned money. And once again we urge anyone facing foreclosure to call 311, so we can connect you with the help you need.”

“Last year, this City Council was among the first to respond to the sub-prime mortgage crisis, creating the Center for New York City Neighborhoods to help keep New Yorkers from losing their homes,” said Council Member Lewis A. Fidler. “Today we’re taking another important step, helping to protect these same homeowners from unscrupulous predators posing as housing consultants. With free housing counseling and legal services available through the Center, no one should ever have to seek help from fraudulent companies.”

“I want to thank Speaker Quinn and my colleague, Council Member Sanders for their leadership on this issue,” stated Consumer Affairs Committee Chair Leroy Comrie. “I am uniquely aware of the problems that distressed property consultants create during the foreclosure prevention process. Nearly everyday a constituent enters my district office desperate for assistance to save their home. In that desperation, they have often turned to a consultant who, for a fee, takes advantage of their plight. Today I am proud to join my fellow Council Members in passing this legislation. I want to urge all New Yorkers, who find themselves in danger of foreclosure, to seek out the numerous non-profits organizations who provide FREE foreclosure prevention assistance.”

“No longer will we allow unscrupulous foreclosure consultants, who are no better than predatory lenders, to prey on homeowners that are trying to hold onto their American dream of homeownership,” said Council Member James Sanders Jr. “If you are a property consultant trying to get rich off of the misery of people in need, this bill was crafted just for you.”


The Council will also vote on legislation that would make it easier for passengers to know and understand their rights when riding in commuter vans by laying out a passenger bill of rights. Under the legislation, commuter van owners will be required to make the bill of rights easily accessible to their passengers.

Commuter van passengers would have rights to:

A vehicle that is in good condition and has passed all required inspections
A properly licensed driver in good standing, with the commission-issued driver’s license information on display
A safe and courteous driver who obeys all traffic laws
A knowledgeable driver who is familiar with the areas where the van is authorized to provide service
Air conditioning or heat on request
A quiet trip free of horn honking or radio or other music playing
Clean air, which is smoke and scent free
Working seatbelts
A clean vehicle, both inside and outside
Be accompanied by a service animal
A driver who does not use a cell phone (hand-held or hands free) while driving
Decline to tip for poor service
“Many New Yorkers, especially in my district, rely on commuter vans to get back and forth from work, play, school, and visiting friends and family,” said Council Member Kendall Stewart, lead sponsor of the bill. “Today we are taking action to ensure that these commuter vans adhere to the same standards of comfort, safety, and service applied to our city’s taxis and livery cabs. This action will make the daily commute a safer and more pleasant experience for thousands of City residents.”


Following several fatal accidents involving unattended idling vehicles, the Council will vote to increase fines for those who leave their cars unattended with the key in the ignition. Currently, the fine for leaving a vehicle unattended with the key in the ignition for three minutes or longer is five dollars. This legislation would remove the three minute rule and increase the penalty to $250. This legislation provides an exception for utility vehicles needing to operate processing devices, as long as these utility vehicles are secured in place with emergency breaks and chocked tires.

“Last February, a seemingly avoidable tragedy struck my district,” said Council Member Elizabeth Crowley, primary sponsor of the Robert Ogle Law. “Sadly, the death of the two young men, Robert Ogle and Alex Paul, may have been avoided if a man had not left his car running while shopping in a store. The current fine for leaving your car ignition on and unattended is five dollars. Under the Robert Ogle bill, the fine will be raised to two-hundred and fifty dollars to deter anyone from being careless with their vehicles. Leaving your car running and unattended seems like a minor, careless mistake but all New Yorkers must understand that it is irresponsible, dangerous and potentially deadly. With this new law, we will avoid these tragedies from happening in New York City.”

“Idling vehicles not only unnecessarily pollute the air, but unattended idling vehicles pose additional dangers to the public. Unattended vehicles left idling have led to too many tragedies, most recently Hayley Ng and Diego Martinez in Lower Manhattan, Alex Paul and Robert Ogle in Middle Village, and many more,” said Transportation Committee Chair John C. Liu. “This year, the City Council has shepherded several bills to allow for more meaningful enforcement of existing anti-idling laws, including near school zones. Int. No. 947 will offer a tougher deterrence to idling and expand upon citywide anti-idling efforts. The message is clear: Just shut the engine off.”

Last year, an unattended idling van in Chinatown rolled backwards and struck and killed two children. In Queens, an intoxicated person stole an idling unattended car and fatally struck two New York City high school students.


With extensive input from local Community Board 6, elected officials, and local residents, the Council will vote to rezone 89 blocks in Brooklyn’s Carroll Gardens neighborhood. This large-scale, contextual rezoning strives to preserve and protect neighborhood character and scale by implementing new height limits throughout the neighborhood and to support local retail corridors while protecting the residential character of nearby side streets. Presently, there are no height restrictions in this traditionally low-rise, brownstone community.

“For the past two years, we have been fighting to preserve the character and context of a unique Brooklyn neighborhood,” said Council Member Bill de Blasio. “Today, I am proud to announce that the Council will vote to legally protect residential blocks in Carroll Gardens from being transformed by out-of-scale development. This victory would not have been possible without the many community organizations and activists who demanded that the voice of their neighborhood was heard.”

“I would like to congratulate Council Members Bill de Blasio and David Yassky, along with Community Board 6 and the many residents who worked tirelessly to make the Carroll Gardens/ Columbia Street rezoning possible,” said Land Use Committee Chair Melinda Katz. “This contextual rezoning will preserve the area’s existing residential character, distinguished by the neighborhood’s historic brownstones, while supporting vibrant, local retail corridors on commercial thoroughfares.”


The Council will vote to approve the expansion of the Modern Museum of Art’s museum complex located in Midtown Manhattan. This proposal includes a 1000 foot, mixed-use building at 53 West 53rd Street between Fifth and Sixth Avenues which will contain a blend of residential, museum and hotel uses. The proposed building will contain just under 100,000 square feet of hotel uses, approximately 480,000 square feet of residential uses and 50,000 square feet set aside for the museum.

Additionally, this development will benefit several adjacent landmarks, including the University Club on West 54th Street and St. Thomas Aquinas on Fifth Ave and 53rd Street, by allowing them to sell their unused air rights to MOMA which will be used to construct the tower.

“The Council, together with City Planning worked diligently to strike an appropriate balance on this proposal,” said Speaker Quinn. “Since the start of the formal land use process the height of the proposed design has been reduced, we were able to eliminate the need for an additional loading dock, and have pledges from MOMA to enliven the 54th Street Sculpture garden Wall and address pedestrian and vehicular traffic through regular community meetings. The proposed building will be a phenomenal addition to our iconic New York Skyline.”

“I would like to congratulate Speaker Quinn, the Museum of Modern Art, Hines, and the many community members who worked diligently to make this project a success,” said Land Use Committee Chair Katz. “This building will be a wonderful addition to our City’s iconic skyline and will enable MoMA to showcase more works of art from its internationally renowned collection.”


The Council will vote on a resolution in support of Congressional legislation that would help increase community input as the United States Post Office (USPS) reorganizes its branches in New York City and throughout the United States. The resolution also calls upon the USPS to use a significant portion of the $3.5 billion increase in its operating budget to protect as many post office locations as possible from closing in New York City.

“I have seen first hand the effects of this proposal in my own district, which currently faces three closures itself,” said Speaker Quinn. “Residents of my district feel that these decisions were made without any real notice or consultation. All New Yorkers deserve access to essential government services like the US Post Office, and I urge Congress to quickly pass this important legislation.”