S T A T E O F N E W Y O R K
________________________________________________________________________
3745
2009-2010 Regular Sessions
I N A S S E M B L Y
January 28, 2009
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Introduced by M. of A. LENTOL -- read once and referred to the Committee
on Banks
AN ACT to amend the banking law, in relation to fees charged by banking
institutions and services provided by such banking institutions
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Legislative intent. The legislature finds and declares that
legislation is necessary to prevent banking institutions from generating
excessive profits from services which are basic to the banking industry.
In addition, the legislature finds that excessive fees imposed are
confiscatory and exclusionary in nature, as well as contrary to good
public policy.
S 2. The banking law is amended by adding a new section 6-n to read as
follows:
S 6-N. USE OF DEPOSITORIES. 1. NOTWITHSTANDING ANY PROVISION OF LAW TO
THE CONTRARY, NEITHER THE STATE OF NEW YORK NOR ANY POLITICAL SUBDIVI-
SION THEREOF, SHALL ENTER INTO OR RENEW OR EXTEND ANY AGREEMENT OR
CONTRACT TO USE AS A DEPOSITORY ANY BANKING INSTITUTION WHICH CHARGES
FEES OF TWO PERCENT OR MORE ABOVE THE FAIR AND REASONABLE PROCESSING
FEES ESTABLISHED BY THE BANKING BOARD PURSUANT TO SECTION FOURTEEN-G OF
THIS CHAPTER.
2. NOTWITHSTANDING ANY PROVISION OF LAW TO THE CONTRARY, NEITHER THE
STATE OF NEW YORK NOR ANY POLITICAL SUBDIVISION THEREOF, SHALL USE AS A
DEPOSITORY ANY BANKING INSTITUTION WHICH CHARGES FEES FOR BASIC TELLER
SERVICES IN VIOLATION OF THE RULES AND REGULATIONS OF THE BANKING BOARD
PROMULGATED PURSUANT TO THE PROVISIONS OF SECTION FOURTEEN-G OF THIS
CHAPTER.
3. FOR PURPOSES OF THIS SECTION, THE TERM BANKING INSTITUTION SHALL
HAVE THE SAME MEANING AS USED IN SECTION NINE-F OF THIS ARTICLE.
S 3. The banking law is amended by adding a new section 9-v to read as
follows:
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05869-01-9
A. 3745 2
S 9-V. AUTOMATED TELLER SERVICES. NOTWITHSTANDING ANY PROVISION OF LAW
TO THE CONTRARY, THE DEPARTMENT AND THE BANKING BOARD SHALL DEVELOP AND
PROMULGATE RULES AND REGULATIONS REQUIRING ANY BANKING INSTITUTION, AS
DEFINED IN SECTION NINE-F OF THIS ARTICLE, WHICH PROVIDES AUTOMATED
TELLER MACHINE SERVICE TO PROVIDE SUCH SERVICE TO BOTH DEPOSITORS AND
NONDEPOSITORS.
S 4. The banking law is amended by adding a new section 14-g to read
as follows:
S 14-G. POWER OF THE BANKING BOARD TO RESTRICT THE CHARGING OF FEES
FOR BASIC TELLER SERVICES AND TO DEVELOP A SCHEDULE OF FEES AND PROCESS-
ING RATES. 1. FOR THE PURPOSES OF THIS SECTION:
(A) THE TERM "BASIC TELLER SERVICES" SHALL MEAN A WITHDRAWAL FROM OR
DEPOSIT TO A CONSUMER TRANSACTION ACCOUNT AS DEFINED IN PARAGRAPH (B) OF
SUBDIVISION NINE OF SECTION FOURTEEN-F OF THIS ARTICLE; EXCEPT THAT
"BASIC TELLER SERVICES" SHALL NOT INCLUDE A TRANSACTION MADE WITH AN
AUTOMATED TELLER MACHINE;
(B) THE TERM "DISCOUNT PLAN" SHALL MEAN A CONSUMER TRANSACTION
ACCOUNT, AS THAT TERM IS DEFINED IN PARAGRAPH (B) OF SUBDIVISION NINE OF
SECTION FOURTEEN-F OF THIS ARTICLE, RESTRICTING THE NUMBER OF FREE BASIC
TELLER SERVICES TRANSACTIONS PER PERIODIC CYCLE AS PROVIDED IN SUBDIVI-
SION THREE OF THIS SECTION AND ESTABLISHING A FEE FOR SUCH SERVICES IN
EXCESS OF SUCH NUMBER OF FREE BASIC TELLER SERVICES TRANSACTIONS.
2. IN ADDITION TO ANY OTHER REQUIREMENTS PROVIDED BY LAW, THE BANKING
BOARD SHALL PROMULGATE RULES AND REGULATIONS TO REQUIRE AND INSURE THAT
NO BANKING INSTITUTION, AS THAT TERM IS DEFINED IN PARAGRAPH (A) OF
SUBDIVISION NINE OF SECTION FOURTEEN-F OF THIS ARTICLE, SHALL CHARGE
CONSUMERS A FEE FOR BASIC TELLER SERVICES EXCEPT AS PROVIDED IN SUBDIVI-
SION THREE OF THIS SECTION.
3. ANY BANKING INSTITUTION, AS THAT TERM IS DEFINED IN PARAGRAPH (A)
OF SUBDIVISION NINE OF SECTION FOURTEEN-F OF THIS ARTICLE, ESTABLISHING
A DISCOUNT PLAN MAY CHARGE CONSUMERS A FEE FOR BASIC TELLER SERVICES,
PROVIDED THAT, SUCH DISCOUNT PLAN PROVIDES AT LEAST FOUR BASIC TELLER
SERVICES FREE OF CHARGE PER PERIODIC CYCLE.
4. IN ADDITION TO ANY OTHER REQUIREMENTS PROVIDED BY LAW, THE BANKING
BOARD SHALL DEVELOP A SCHEDULE OF FAIR AND REASONABLE RATES FOR ALL
BANKING TRANSACTIONS WHICH RESULT IN FEES TO THE CONSUMER INCLUDING, BUT
NOT LIMITED TO, ATM WITHDRAWALS, OVERDRAFT PROCESSING, CHECKING ACCOUNT
MAINTENANCE, PRINTING OF CHECKS AND ACCOUNT TRANSFERS.
S 5. Paragraph (b) of subdivision 2 of section 14-f of the banking
law, as added by chapter 1 of the laws of 1994, is amended to read as
follows:
(b) the maximum amount a banking institution may require as a minimum
balance, if any, to maintain such account, PROVIDED THAT SUCH BANKING
INSTITUTION SHALL PROVIDE MINIMAL CHECKING ACCOUNT SERVICES WITHOUT
REQUIRING A MINIMUM BALANCE;
S 6. This act shall take effect on the ninetieth day after it shall
have become a law; provided that the banking board, the state of New
York and any political subdivision thereof may take any action necessary
for the timely implementation of this act on its effective date on or
before such date.