Our faith traditions compel us to show compassion for debtors. New York is uniquely positioned to set fairer rules for dealing withcountries that cannot pay their debts.
By MattCutler and Rashida Tyler, For the Times Union May 29, 2026
The great faith traditions teach us that debtors need tohave a chance to start anew in life — that no one should be in debt inperpetuity.
In the Christian and Jewish traditions that we practice,this idea is captured in the biblical commandment to practice the Jubilee — ayear of forgiveness of debt. Here in New York, our elected officials in theSenate and the Assembly have the opportunity to act in the spirit of Jubilee topass the Champerty Act (S1477/A643A) and make real in our world today thebiblical exhortation to bring the spirit of Jubilee to our lives.
Pope Francis called for this in convening the Jubilee Yearof 2025 year last year. Neither of us is Catholic, but we resonate withFrancis’ call to stop predatory actors and build a world in which we all haveenough. The New York Conference of Catholic Bishops strongly supports thislegislation, as do other major faiths across our state.
New York is one of two legal jurisdictions in the world thatinternational borrowers and lenders use to write their loan agreements. Theother is the United Kingdom. But unlike the United Kingdom, there is noprovision of any kind in New York law that sets rules for how to deal withindependent countries that cannot pay their debts.
This creates opportunities for hedge funds to buy up thedebt of the world’s poorest countries. This is debt that other governments andorganizations like the International Monetary Fund have recognized cannot bepaid in full without bringing on social disaster in the debtor country —collapse of education and health systems, or inability to maintain criticalphysical infrastructure. But then these “vulture funds” ask New York courts toforce the country to pay them more than the other creditors have agreed to.
Communities of faith have been working for years to closethe loophole that allows a handful of predatory financial firms to use ourstate’s courts for litigation that actively harms New York’s interest in ahealthy global economy and fair credit markets.
Last year, the Champerty Act was put before both houses andpassed the Senate. In essence, this careful but effective bill does two things:It says an investor cannot make a practice of buying debts they know to be badwith the plan of trying to get the courts to force the debtor to pay thatinvestor. And it reduces the statutory interest rate in New York for defaulteddebt of all kinds from its current punitive level to a level that makes senseeconomically — one tied to market interest rates.
The bill is so carefully targeted at the handful of fundsthat actually engage in champerty that it has received support andnon-objections from many of the key players in the state business community,including last year the Partnership for New York.
The bill has bipartisan support and it needs to pass. In thespirit of our religious traditions, we strongly encourage our legislators topass this measure into law this year.
MattCutler is the rabbi at Congregation Gates of Heaven in Schenectady. RashidaTyler is the executive director of the New York State Council of Churches.
https://www.timesunion.com/opinion/article/vulture-funds-champerty-new-york-22280333.php
