senate Bill S760

Prohibits issuers of credit cards and debit cards from knowingly accepting or soliciting financial information of a cardholder from a third-party

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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

  • 09 / Jan / 2013
    • REFERRED TO CONSUMER PROTECTION
  • 27 / Feb / 2013
    • 1ST REPORT CAL.105
  • 28 / Feb / 2013
    • 2ND REPORT CAL.
  • 04 / Mar / 2013
    • ADVANCED TO THIRD READING
  • 21 / Jun / 2013
    • COMMITTED TO RULES

Summary

Establishes issuers of credit cards and debit cards are prohibited from knowingly accepting or soliciting personal financial information of a cardholder from a third-party; establishes a civil penalty not to exceed two thousand dollars for each violation of this section.

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Bill Details

See Assembly Version of this Bill:
A3991
Versions:
S760
Legislative Cycle:
2013-2014
Current Committee:
Senate Rules
Law Section:
General Business Law
Laws Affected:
Add ยง518-b, Gen Bus L
Versions Introduced in Previous Legislative Cycles:
2011-2012: S5061, A5175, S5061
2009-2010: A8485, A8485
2007-2008: A6852, A6852
2013-2014: S6280, S760

Votes

11
0
11
Aye
0
Nay
0
aye with reservations
0
absent
0
excused
0
abstained
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Sponsor Memo

BILL NUMBER:S760

TITLE OF BILL:
An act to amend the general business law, in relation to prohibiting
issuers from accepting personal financial information of holders from a
third-party

PURPOSE:
This bill would prohibit card issuers from
knowingly accepting or soliciting personal financial information about a
cardholder from a person other than the card holder.

SUMMARY OF PROVISIONS:
This bill would add a new
Section 518-b to the General Business Law, which would prohibit issuers
of credit cards and debit cards from knowingly accepting or soliciting
the personal information of a holder from a person other than the card
holder. A violation of these provisions would be punishable by a civil
penalty not to exceed two thousand dollars for each such violation.

JUSTIFICATION:
Third-parties should not be permitted
to give personal information about a credit or debit cardholder to the
issuer of the card. The cardholder is ultimately responsible for the use
of the card, and their credit history is effected by any use of or
changes to the account. Any errors in the information provided by a
third-party might be recorded on a consumer credit report, where even
providing a different street address can affect a consumer's credit
history. Also, if a third-party were permitted to give the address of
the cardholder to the issuer, they might be able to divert monthly
statements to another address or raise the limit of the line of credit
attached to the card. Likewise, in the case of a divorced spouse or when
a child is a third-party user of their parent's card, such a user might
be able to cause harm to the cardholder or the cardholder's credit by
Riving inaccurate or misleading information to the issuer.

In recognition of the fact that the cardholder is ultimately responsible
for the use of their card, this legislation would make them the sole
source of personal information about themselves. At the seine time, this
bill would not limit the transmittal of financial or transaction
information by merchants or businesses, in recognition of the fact that
the transmittal of these types of information is necessary for the use
of credit and debit cards.

LEGISLATIVE HISTORY:
2011-2012: Consumer Protection Committee (S.5061)
2007-2008: Consumer Protection Committee (S.4308/A/6852)
2005-2006: Consumer Protection Committee (S.4687/A.9321)

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
On the first of September next
succeeding the date on which it shall have become a law.


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

                                   760

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  Sens.  FUSCHILLO, MAZIARZ, RANZENHOFER -- read twice and
  ordered printed, and when printed to be committed to the Committee  on
  Consumer Protection

AN  ACT  to  amend  the general business law, in relation to prohibiting
  issuers from accepting personal financial information of holders  from
  a third-party

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

  Section 1. The general business law is amended by adding a new section
518-b to read as follows:
  S 518-B. PROHIBITED CREDIT CARD USER INFORMATION REQUESTS. 1.  ISSUERS
OF  CREDIT CARDS AND DEBIT CARDS ARE PROHIBITED FROM KNOWINGLY ACCEPTING
OR SOLICITING THE PERSONAL FINANCIAL INFORMATION  OF  A  HOLDER  FROM  A
THIRD-PARTY.  PROVIDED, HOWEVER, THAT NO PROVISION OF THIS SECTION SHALL
BE DEEMED TO PROHIBIT AN ISSUER OF A CREDIT  CARD  OR  DEBIT  CARD  FROM
ACCEPTING  OR  SOLICITING  FROM  A  BANKING  ORGANIZATION, AS DEFINED IN
SECTION TWO OF THE BANKING LAW, THE PERSONAL INFORMATION OF A HOLDER FOR
THE PURPOSE OF VERIFYING THE IDENTITY OF SUCH HOLDER AND PREVENT IMPROP-
ER OR UNAUTHORIZED USE.
  2. A VIOLATION OF THE PROVISIONS OF THIS SECTION BY AN ISSUER SHALL BE
PUNISHABLE BY A CIVIL PENALTY NOT TO EXCEED  TWO  THOUSAND  DOLLARS  FOR
EACH SUCH VIOLATION.
  S  2.  This  act  shall  take  effect  on  the first of September next
succeeding the date on which it shall have become a law.



 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD01400-01-3

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