NY State Senate Bill 2015-S4778A

Senate Bill S4778A

2015-2016 Legislative Session

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

download bill text pdf

Archive: Last Bill Status - In Senate Committee Rules Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Jun 17, 2016	committed to rules
May 10, 2016	amended on third reading (t) 4778a
May 04, 2016	advanced to third reading
May 03, 2016	2nd report cal.
Apr 12, 2016	1st report cal.604
Jan 06, 2016	referred to consumer protection
Jun 25, 2015	committed to rules
Jun 02, 2015	advanced to third reading
Jun 01, 2015	2nd report cal.
May 28, 2015	1st report cal.1035
Apr 15, 2015	referred to consumer protection

Votes

- Apr 12, 2016 - Consumer Protection Committee Vote
  S4778A
  
  11
  
  Aye
  
  0
  
  Nay
  
  0
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Consumer Protection Committee Vote: Apr 12, 2016
      
      aye (11)
      
      Akshar
      
      Amedore
      
      Boyle
      
      Comrie
      
      Funke
      
      Latimer
      
      Peralta
      
      Robach
      
      Savino
      
      Serrano
      
      Venditto
  May 28, 2015 - Consumer Protection Committee Vote
  S4778A
  
  11
  
  Aye
  
  0
  
  Nay
  
  0
  
  Aye with Reservations
  
  0
  
  Absent
  
  0
  
  Excused
  
  0
  
  Abstained
  - - Consumer Protection Committee Vote: May 28, 2015
      
      aye (11)
      
      Amedore
      
      Boyle
      
      Comrie
      
      Funke
      
      Latimer
      
      Marchione
      
      Peralta
      
      Robach
      
      Savino
      
      Serrano
      
      Venditto

Bill Amendments

Original

A (Active)

2015-S4778 - Details

Current Committee:: Senate Rules
Law Section:: General Business Law
Laws Affected:: Add §518-b, Gen Bus L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S5061
2013-2014: S760, S6280
2017-2018: S4056
2019-2020: S1404

2015-S4778 - 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.

2015-S4778 - Sponsor Memo

                                BILL NUMBER:S4778

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.

EXISTING LAW: None.

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:  2005-2006: Consumer Protection Committee
(S.4687/A.9321) 2007-2008: Consumer Protection Committee
(S.4308/A/6852) 2011-2012: Consumer Protection Committee (S.5061)
2013: Rules Committee (S.760) 2014: Consumer Protection Committee
(S.6280)

FISCAL IMPLICATIONS: None to the state.

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

2015-S4778 - Bill Text download pdf

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

                                  4778

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                             April 15, 2015
                               ___________

Introduced  by Sen. VENDITTO -- 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.
                                                           LBD10403-01-5

2015-S4778A (ACTIVE) - Details

Current Committee:: Senate Rules
Law Section:: General Business Law
Laws Affected:: Add §518-b, Gen Bus L
Versions Introduced in Other Legislative Sessions:: 2011-2012: S5061
2013-2014: S760, S6280
2017-2018: S4056
2019-2020: S1404

2015-S4778A (ACTIVE) - Summary

2015-S4778A (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S4778A

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

 PURPOSE :

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

 SUMMARY OF PROVISIONS :

Section one of this bill adds a new Section 518-b to the General
Business Law, which would prohibit issuers of credit cards and debit
cards from accepting or soliciting the nonpublic personal information
of a cardholder from a person other than the card holder, while
allowing for the transmission of this information between these
companies to facilitate services authorized by the cardholder. A
violation of these provisions would be punishable by a civil penalty
not to exceed two thousand dollars for each such violation.

Section two of the bill provides that the bill takes effect on the
first of September next succeeding the date on which this bill becomes
law.

 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 giving 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
same 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. Finally, this bill
also conforms with current federal legislation (the Gramm-Leach-Bliley
Act) on this issue.

 PRIOR LEGISLATIVE HISTORY :

2005-2006: Consumer Protection Committee (S.4687/A.9321)
2007-2008: Consumer Protection Committee (S.4308/A/6852)
2011-2012: Consumer Protection Committee (S.5061)
2013: Rules Committee (S.760)
2014: Consumer Protection Committee (S.6280).

 FISCAL IMPACT :

None to the state.

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

2015-S4778A (ACTIVE) - Bill Text download pdf

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

                                 4778--A
    Cal. No. 604

                       2015-2016 Regular Sessions

                            I N  S E N A T E

                             April 15, 2015
                               ___________

Introduced  by Sen. VENDITTO -- 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  --  reported favorably from said committee,
  ordered to first and  second  report,  ordered  to  a  third  reading,
  amended  and  ordered  reprinted,  retaining its place in the order of
  third reading

AN ACT to amend the general business law,  in  relation  to  prohibiting
  issuers  from accepting nonpublic personal 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 ACCEPTING OR  SOLIC-
ITING THE NONPUBLIC PERSONAL 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  NONPUBLIC  PERSONAL  INFORMATION OF A HOLDER FOR THE
PURPOSE OF VERIFYING THE IDENTITY OF SUCH HOLDER AND PREVENTING IMPROPER
OR UNAUTHORIZED USE.
  2. NONPUBLIC PERSONAL INFORMATION SHALL HAVE THE SAME MEANING AS IN 15
U.S.C. S 6809(4).
  3. THIS  SECTION  SHALL  NOT  PROHIBIT  THE  DISCLOSURE  OF  NONPUBLIC
PERSONAL INFORMATION TO A THIRD PARTY:
  (A)  AS  NECESSARY  TO  EFFECT,  ADMINISTER,  OR ENFORCE A TRANSACTION
REQUESTED OR AUTHORIZED BY THE CONSUMER;
  (B) IN ORDER TO SERVICE OR PROCESS  A  FINANCIAL  PRODUCT  OR  SERVICE
REQUESTED OR AUTHORIZED BY THE CONSUMER;

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

                                                           LBD10403-03-6

S. 4778--A                          2

  (C) IN ORDER TO MAINTAIN OR SERVICE THE CONSUMER'S ACCOUNT HELD BY THE
ISSUER OF THE CREDIT OR DEBIT CARD; OR
  (D) TO PROTECT AGAINST OR PREVENT ACTUAL OR POTENTIAL FRAUD, UNAUTHOR-
IZED TRANSACTIONS, CLAIMS, OR OTHER LIABILITY.
  4. 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.

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