New law aims to curb ‘paper terrorists’
New York State Gov. Andrew Cuomo has signed into law a legislative measure to curb filings against judges and other public officers.
The Uniform Commercial Code (UCC) contains a provision that allows creditors to record an interest in a debtor’s property, thus giving notice to other creditors, future and present. A creditor can file financing statements, which are accessible via an online search engine, showing that a particular debt is owed. Banks and other financial institutions, as well as employers and members of the public, can access these records and often use them as a determination of an individual’s credit risk.
In recent years, incarcerated persons and others with grievances against judges and other court personnel began filing fraudulent financing statements on the UCC database, making it appear as though a particular judge, for example, is in default of non-existent outstanding debts. There has been a “dramatic increase in number of fraudulent UCC filings,” the National Association of Secretaries of State noted in its August 2012 report.