senate Bill S6551A

Relates to requiring credit cards to contain smart chip technology

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 04 / Feb / 2014
    • REFERRED TO CONSUMER PROTECTION
  • 14 / Feb / 2014
    • AMEND (T) AND RECOMMIT TO CONSUMER PROTECTION
  • 14 / Feb / 2014
    • PRINT NUMBER 6551A

Summary

Relates to requiring credit cards to contain smart chip technology; states that a lending institution shall not issue credit or debit cards without smart chip technology; provides definitions for the terms "smart chip", "chip and pin", and "chip and signature."

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Bill Details

See Assembly Version of this Bill:
A8649A
Versions:
S6551
S6551A
Legislative Cycle:
2013-2014
Current Committee:
Senate Consumer Protection
Law Section:
Banking Law
Laws Affected:
Amd §2, add §9-v, Bank L
Versions Introduced in 2013-2014 Legislative Cycle:
A8649A

Sponsor Memo

BILL NUMBER:S6551A

TITLE OF BILL: An act to amend the banking law, in relation to
requiring credit cards to contain smart chip technology

PURPOSE: To require credit cards issued to New York State residents
be equipped with smart chip technology.

SUMMARY OF PROVISIONS:

Section one adds a new subdivision 30 to section 2 of the banking law
to define the terms "smart chip," "chip and PIN," and "chip and
signature."

Section two adds a new section 9-v to the banking law to require that
lending institutions must issue credit cards containing smart chip
technology.

Section three provides the effective date.

JUSTIFICATION: Today, most credit cards issued to New Yorkers still
rely on the magnetic stripe - a technology which was developed in the
1960s. However, more than 80 countries have adopted smart chip
technology for the issuance of credit cards.

The technology enables a credit card user's information to be stored
on a microprocessor chip, instead of the magnetic stripe which is much
easier to hack. The information contained on the chip is encrypted,
and the user's address and PIN are not stored.

Millions of people each year are affected by credit card fraud. In a
recent case, a retailer had 40 million debit and credit accounts
hacked. In Canada, debit card fraud has dropped 45% since the initial
implementation of chip and pin in 2009. This legislation is necessary
to protect consumers from hackers and credit and debit card fraud.

LEGISLATIVE HISTORY: New.

FISCAL IMPLICATIONS:. None to the state.

EFFECTIVE DATE: Immediate and shall apply to all credit cards issued
or reissued on and after January 1, 2015.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 6551--A

                            I N  S E N A T E

                            February 4, 2014
                               ___________

Introduced  by  Sen.  GRIFFO -- read twice and ordered printed, and when
  printed to be committed to the Committee  on  Consumer  Protection  --
  recommitted to the Committee on Consumer Protection in accordance with
  Senate  Rule  6, sec. 8 -- committee discharged, bill amended, ordered
  reprinted as amended and recommitted to said committee

AN ACT to amend the banking law, in relation to requiring  credit  cards
  to contain smart chip technology

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. Section 2 of the banking law is amended  by  adding  a  new
subdivision 30 to read as follows:
  30.  SMART CHIP. THE TERM, "SMART CHIP" MEANS A CREDIT CARD TECHNOLOGY
WHERE CARDS ARE EMBEDDED WITH CHIPS AND A CARDHOLDER MUST PUT  IN  THEIR
PIN OR SIGN FOR EACH TRANSACTION TO BE APPROVED. THIS INCLUDES "CHIP AND
PIN"  AND "CHIP AND SIGNATURE" AS SECURE METHODS TO PROTECT AGAINST CARD
HACKERS AND FRAUD.
  (A) "CHIP AND PIN" REQUIRES A CONSUMER TO ENTER  A  PIN  NUMBER  AFTER
EACH TRANSACTION FOR APPROVAL.
  (B) "CHIP AND SIGNATURE" REQUIRES A CONSUMER TO INSERT THE CARD INTO A
PORTABLE  ELECTRONIC  READER  AND THEN SUBSEQUENTLY SIGN FOR APPROVAL OF
THE TRANSACTION.
  S 2. The banking law is amended by adding a new section 9-v to read as
follows:
  S 9-V. SMART CHIP TECHNOLOGY.  A LENDING INSTITUTION,  AS  DEFINED  IN
PARAGRAPH  (A)  OF  SUBDIVISION  ONE  OF SECTION NINE-T OF THIS ARTICLE,
SHALL NOT ISSUE CREDIT CARDS OR DEBIT CARDS WITHOUT SMART CHIP TECHNOLO-
GY AS DEFINED IN SUBDIVISION THIRTY OF SECTION TWO OF THIS ARTICLE.
  S 3. This act shall take effect immediately and  shall  apply  to  all
credit cards issued or reissued on and after January 1, 2015.


 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD13699-02-4

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