N.Y. Judiciary Law § 489: Purchase of claims by corporations or collection agencies

§ 489. Purchase of claims by corporations or collection agencies. 1.

No person or co-partnership, engaged directly or indirectly in the

business of collection and adjustment of claims, and no corporation or

association, directly or indirectly, itself or by or through its

officers, agents or employees, shall solicit, buy or take an assignment

of, or be in any manner interested in buying or taking an assignment of

a bond, promissory note, bill of exchange, book debt, or other thing in

action, or any claim or demand, with the intent and for the purpose of

bringing an action or proceeding thereon; provided however, that bills

receivable, notes receivable, bills of exchange, judgments or other

things in action may be solicited, bought, or assignment thereof taken,

from any executor, administrator, assignee for the benefit of creditors,

trustee or receiver in bankruptcy, or any other person or persons in

charge of the administration, settlement or compromise of any estate,

through court actions, proceedings or otherwise. Nothing herein

contained shall affect any assignment heretofore or hereafter taken by

any moneyed corporation authorized to do business in the state of New

York or its nominee pursuant to a subrogation agreement or a salvage

operation, or by any corporation organized for religious, benevolent or

charitable purposes. Any corporation or association violating the

provisions of this section shall be liable to a fine of not more than

five thousand dollars; any person or co-partnership, violating the

provisions of this section, and any officer, trustee, director, agent or

employee of any person, co-partnership, corporation or association

violating this section who, directly or indirectly, engages or assists

in such violation, is guilty of a misdemeanor.

2. Except as set forth in subdivision three of this section, the

provisions of subdivision one of this section shall not apply to any

assignment, purchase or transfer hereafter made of one or more bonds,

promissory notes, bills of exchange, book debts, or other things in

action, or any claims or demands, if such assignment, purchase or

transfer included bonds, promissory notes, bills of exchange and/or book

debts, issued by or enforceable against the same obligor (whether or not

also issued by or enforceable against any other obligors), having an

aggregate purchase price of at least five hundred thousand dollars, in

which event the exemption provided by this subdivision shall apply as

well to all other items, including other things in action, claims and

demands, included in such assignment, purchase or transfer (but only if

such other items are issued by or enforceable against the same obligor,

or relate to or arise in connection with such bonds, promissory notes,

bills of exchange and/or book debts or the issuance thereof).

3. The rights of an indenture trustee, its agents and employees shall

not be affected by the provisions of subdivision two of this section.