senate Bill S703

2013-2014 Legislative Session

Prohibits banking organizations from issuing mail-loan checks without request or application therefor

download bill text pdf

Sponsored By

Archive: Last Bill Status - In Committee


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

do you support this bill?

Actions

view actions (2)
Assembly Actions - Lowercase
Senate Actions - UPPERCASE
Jan 08, 2014 referred to banks
Jan 09, 2013 referred to banks

S703 - Bill Details

See Assembly Version of this Bill:
A2792
Current Committee:
Senate Banks
Law Section:
Banking Law
Laws Affected:
Amd ยง9-t, Bank L
Versions Introduced in Previous Legislative Sessions:
2011-2012: S651A, A2850A
2009-2010: S64, A2604

S703 - Bill Texts

view summary

Prohibits banking organizations from issuing mail-loan checks without request or application therefor; provides that failure to destroy or return a mail-loan check does not constitute an acceptance thereof; provides that mail-loan checks shall have the transaction fee and interest rate included on the check.

view sponsor memo
BILL NUMBER:S703

TITLE OF BILL:
An act
to amend the banking law, in relation to mail-loan checks

PURPOSE OR GENERAL IDEA OF BILL:
Prohibits banking organizations from
issuing mail-loan checks without request or application, in order to
protect consumers from potentially unsafe banking products.

SUMMARY OF SPECIFIC PROVISIONS:
This bill amends subdivisions 2 and 3
of section 9-t of the banking law and adds a new subdivision 4 to
section 9-t of the banking law.

JUSTIFICATION:
The practice of mailing unsolicited loan checks to
consumers can prove confusing to the consumer with respect to the
obligation flowing from his or her endorsement.
Additionally, an unsolicited loan check received by mail may be cashed
by an unknown payee obligating the payee to repay the loan. This bill
would negate the problems noted above.

PRIOR LEGISLATIVE HISTORY:
S.7493 of 2008
04/08/08 REFERRED TO BANKS
S651A of 2011
01/05/11 REFERRED TO BANKS
01/04/12 REFERRED TO BANKS
05/31/12 AMEND(T) AND RECOMMIT TO BANKS
05/31/12 PRINT NUMBER 651A

FISCAL IMPLICATIONS:
None.

EFFECTIVE DATE:
One hundred twentieth day after it becomes law.

view full text
download pdf
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                   703

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                               (PREFILED)

                             January 9, 2013
                               ___________

Introduced  by  Sen. SAMPSON -- 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 mail-loan checks

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

  Section  1. Subdivisions 2 and 3 of section 9-t of the banking law, as
added by chapter 309 of the laws of 2002, are amended and a new subdivi-
sion 4 is added to read as follows:
  2. Any lending institution which issues mail-loan checks shall:
  (a) include on the face of each check issued to a non-customer a writ-
ten statement, in legible type reading "ONE FORM OF  VALID  PHOTOGRAPHIC
ID  NEEDED TO CASH OR DEPOSIT"; provided, however, that any entity cash-
ing or accepting a mail-loan check for deposit may require more than one
form of identification;
  (b) make no reference on the outside  of  the  envelope  containing  a
mail-loan  check  that  indicates  that  a check is enclosed within such
envelope;
  (c) provide that all mail-loan checks shall be non-transferable; and
  (d) include THE TRANSACTION FEE AND INTEREST RATE  AND  an  expiration
date  of not more than six months on the mail-loan check, AS WELL AS ANY
ADDITIONAL INFORMATION THAT THE SUPERINTENDENT MAY REQUIRE.
  3. NO LENDING INSTITUTION SHALL ISSUE A  MAIL-LOAN  CHECK,  EXCEPT  IN
RESPONSE TO A REQUEST OR APPLICATION THEREFOR.
  4. FAILURE TO DESTROY OR RETURN A MAIL-LOAN CHECK SHALL NOT CONSTITUTE
ACCEPTANCE OF THE CHECK.
  5.  Any lending institution which mails a mail-loan check in violation
of the provisions of this section shall be liable for  a  civil  penalty
not to exceed five hundred dollars for each such violation.
  S 2. This act shall take effect on the one hundred twentieth day after
it shall have become a law.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00560-01-3

Comments

Open Legislation comments facilitate discussion of New York State legislation. All comments are subject to moderation. Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity or hate speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Comment moderation is generally performed Monday through Friday.

By contributing or voting you agree to the Terms of Participation and verify you are over 13.