NY A09241

Creates Article 39-H in General Business Law to regulate consumer litigation funding companies providing non-recourse loans to consumers pending settlement or judgment.

Requires litigation funding contracts to include a 10-day rescission period, written attorney acknowledgment of contingency fee arrangement with no referral fees, itemized fee schedules, and no-penalty prepayment provisions.

Prohibits funding companies from paying referral fees to medical providers, therapists or attorneys; violating attorney-client privilege; having financial interests in consumer attorneys; obtaining waivers of damages; or requiring arbitration/jury trial waivers.

Caps charges at the rate prescribed in Banking Law section 14-a, with violations considered usurious; prohibits contract assignment.

Requires consumer litigation funding companies to register with the New York Department of Financial Services with $500 initial fee and biennial renewal, with violators losing right to recover funded amounts and fees in that case.