senate Bill S3930

2013-2014 Legislative Session

Requires agents of licensed money transmitters to remit moneys to the licensee within the time frame provided in the contract between the agent and the licensee

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Archive: Last Bill Status - Passed Senate


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

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Actions

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Assembly Actions - Lowercase
Senate Actions - UPPERCASE
May 29, 2014 referred to banks
delivered to assembly
passed senate
May 13, 2014 advanced to third reading
May 12, 2014 2nd report cal.
May 07, 2014 1st report cal.596
Jan 08, 2014 referred to banks
returned to senate
died in assembly
Jun 12, 2013 referred to banks
delivered to assembly
passed senate
Jun 11, 2013 advanced to third reading
Jun 10, 2013 2nd report cal.
Jun 05, 2013 1st report cal.1131
Feb 27, 2013 referred to banks

Votes

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May 7, 2014 - Banks committee Vote

S3930
19
0
committee
19
Aye
0
Nay
0
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Banks committee vote details

Jun 5, 2013 - Banks committee Vote

S3930
14
0
committee
14
Aye
0
Nay
5
Aye with Reservations
0
Absent
0
Excused
0
Abstained
show Banks committee vote details

Co-Sponsors

S3930 - Bill Details

See Assembly Version of this Bill:
A6940
Current Committee:
Assembly Banks
Law Section:
Banking Law
Laws Affected:
Amd ยง651-a, Bank L

S3930 - Bill Texts

view summary

Requires agents of licensed money transmitters to remit moneys to the licensee within the time frame provided in the contract between the agent and the licensee; makes agents liable for treble damages for failure to remit moneys in a timely manner.

view sponsor memo
BILL NUMBER:S3930

TITLE OF BILL: An act to amend the banking law, in relation to
remittances of moneys by agents of licensed transmitters of money

PURPOSE: To authorize treble damages in order to deter agents of
licensed money transmitters from abusing business relationships and
consumer trust by absconding with funds.

SUMMARY OF PROVISIONS:

Section 1 amends the banking law to impose treble damages for agents
of money transmitters who fail to remit moneys within a time period to
be established by the superintendent.

Section 2 establishes the effective date.

JUSTIFICATION: Money transmitters play a critical role in the economy
of New York State, providing consumers with safe and secure financial
services including money orders, bill payments, and secure local,
national and international funds transfers. In order to reach a broad
spectrum of consumers, money transmitters transact business through
agents who, in turn, provide direct services to a local customer base.
As soon as the agent receives funds from the customer, the money
transmitter is legally obligated to pay the funds to a beneficiary as
directed by the customer, whether or not the money transmitter ever
receives the funds from the agent. These agents are legitimized in the
eyes of consumers by their relationships with known and reliable money
transmitters. Unfortunately, despite the best efforts at screening, an
alarming number of agents abscond with funds collected from customers
and fail to remit the funds to the transmitter. This leaves the money
transmitter legally obligated to pay for the instrument the rogue
agent sold despite never having received the funds from the agent for
the transaction and forces the money transmitter to take costly
measures to attempt to recoup the funds from the dishonest agents.
Moreover, these bad actors abuse the public trust and drive up the
cost of doing business, which hurts consumers.

This bill, modeled after existing law in jurisdictions including New
Jersey, North Carolina, Illinois and the District of Columbia, would
serve to deter these bad actors by authorizing treble damages against
agents who abscond with funds owed to the money transmitting
companies. This legislation is necessary to protect both money
transmitters and consumers because prosecuting agencies most often
consider these actions to be civil matters, leaving money transmitters
no recourse but to undertake costly litigation and pass at least some
of the costs onto consumers. The threat of treble damages will change
the calculus for potential bad actors, help make wronged money
transmitters whole, and provide potentially significant savings to
consumers.

LEGISLATIVE HISTORY: This is a new bill.

FISCAL IMPLICATIONS: To be determined.


EFFECTIVE DATE: This act shall take effect on the one hundred
eightieth day after it shall have become law; provided that, effective
immediately, any rules and regulations necessary to implement the
provisions of this act on its effective date are authorized and
directed to be completed on or before such date.

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

                                  3930

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            February 27, 2013
                               ___________

Introduced  by  Sen. PERALTA -- read twice and ordered printed, and when
  printed to be committed to the Committee on Banks

AN ACT to amend the banking law, in relation to remittances of moneys by
  agents of licensed transmitters of money

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

  Section  1.  The opening paragraph of section 651-a of the banking law
is designated subdivision 1 and a new subdivision 2 is added to read  as
follows:
  2. EVERY AGENT OF A LICENSEE SHALL REMIT ALL MONEYS OWED SUCH LICENSEE
IN  ACCORDANCE  WITH  THE TERMS OF THE CONTRACT BETWEEN THE LICENSEE AND
SUCH AGENT. ANY FAILURE OF AN AGENT TO REMIT ALL MONEYS  DUE  AND  OWING
THE  LICENSEE  WITHIN THE TIME PROVIDED IN SUCH CONTRACT SHALL RESULT IN
THE AGENT'S  CIVIL  LIABILITY  TO  THE  LICENSEE  FOR  THREE  TIMES  THE
LICENSEE'S DAMAGES. THE SUPERINTENDENT MAY, BY RULE, ESTABLISH THE MAXI-
MUM PERIOD OF TIME FOR REMITTANCE.
  S 2. This act shall take effect on the one hundred eightieth day after
it  shall  have become a law; provided, that, effective immediately, any
rules and regulations necessary to implement the provisions of this  act
on  its effective date are authorized and directed to be completed on or
before such date.




 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09338-01-3

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