NY State Senate Bill 2017-S8155

Senate Bill S8155

2017-2018 Legislative Session

Prohibits a consumer reporting agency or lender from using certain information to determine an individual's credit worthiness

download bill text pdf

Archive: Last Bill Status - In Senate Committee Consumer Protection 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

Please enter your contact information

First Name

Last Name

Email Address

A valid email address is required.

Home address is used to determine the senate district in which you reside. Your support or opposition to this bill is then shared immediately with the senator who represents you.

Optional services from the NY State Senate:

Create an account. An account allows you to officially support or oppose key legislation, sign petitions with a single click, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Include a custom message for your Senator? (Optional)

Enter a message to your senator. Many New Yorkers use this to share the reasoning behind their support or opposition to the bill. Others might share a personal anecdote about how the bill would affect them or people they care about.

Actions

View Actions

	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Apr 11, 2018	referred to consumer protection

co-Sponsors

2017-S8155 (ACTIVE) - Details

See Assembly Version of this Bill:: A5106
Current Committee:: Senate Consumer Protection
Law Section:: General Business Law
Laws Affected:: Amd §§380-a & 380-j, Gen Bus L; amd §§2 & 352, Bank L
Versions Introduced in Other Legislative Sessions:: 2015-2016: S6853, A9150
2019-2020: S2302, A5294

2017-S8155 (ACTIVE) - Summary

Prohibits a consumer reporting agency or lender from using the credit scores of members of an individual's social network to determine the credit worthiness of such individual.

2017-S8155 (ACTIVE) - Sponsor Memo

                                
 
BILL NUMBER: S8155

SPONSOR: KAVANAGH
 
TITLE OF BILL:  An act to amend the general business law and the bank-
ing law, in relation to prohibiting a consumer reporting agency or lend-
er from using certain information to determine an individual's credit
worthiness

 
PURPOSE:

Prohibits a consumer reporting agency or lender from using the member-
ship of the consumer's social network information to determine an indi-
vidual's credit worthiness

 
SUMMARY OF SPECIFIC PROVISIONS:

Section 1. Section 380-a of the general business law is amended by
adding a new subdivision (u) to read as follows:

u) Members of a consumer's social network: a group of individuals
authorized by a consumer to be part of his or her social media network.

Section 2. Section 380-j of the general business law is amended by
adding a new subdivision (h) to read as follows:

(h) No consumer reporting agency shall collect, evaluate, report, or
maintain in the file on a consumer the consumer's use of internet or web
browsing history as a factor to determine the consumer's credit score,
standing or credit capacity.

Section 3. Section 2 of the banking law is amended by adding a new
subdivision 30 to read as follows: Members of a borrower's social
network: a group of individuals authorized by a borrower to be part of
his or her social media network.

Section 4. Section 352 of the banking law is amended by adding a new
sixth undesignated paragraph to read as follows:

No licensee shall collect, evaluate, report or maintain in the file on a
borrower, the borrower's use of Internet or internet viewing history as
a factor to determine the borrower's credit worthiness, credit standing
or credit capacity.

Section 5 contains the effective date.

 
JUSTIFICATION:

Consumers in the United States continue to be under attack by the fuzzy
math used to calculate credit scores. The US General Accounting Office
has estimated that some 75% of credit scores are wrong based on incor-
rect information collected by credit bureaus and attached to individual
credit scores.

As if this was not detrimental enough to the average consumer, credit
scores are used by employers to screen potential employees, by landlords
and even by graduate schools for students applying to business majors.
The errors on these reports and the fuzzy math used to create the credit
score are impacting every aspect of our lives.  To make matters worse,
the FICO score, a measure of consumer credit risk, which has become a
fixture of consumer lending in the United States, is moving to add
consumer's social network as another variable in the more than 100 vari-
able equation used to compute a consumer's credit score.

FICO is looking to lumping all of the individual consumers' social
network members credit scores and taking that average into account as a
variable to derive a new credit score for individual consumers.  This is
an obvious invasion of privacy and another fuzzy math approach to hurt
consumers.

It is obvious that individuals in low income communities will have a
social network of similar individuals based on geography only. So why
should low income consumers be further stigmatized and penalized via
worsening credit scores. FICO's attempt to do this should be banned and
this legislation does exactly that.

 
PRIOR LEGISLATIVE HISTORY:

2017: A5106 by Crespo: referred to consumer affairs and protection
2016: A9150 by Crespo: referred to consumer affairs and protection

 
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENT:

None

 
EFFECTIVE DATE:
Immediately.

2017-S8155 (ACTIVE) - Bill Text download pdf

                            
 
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   8155
 
                             I N  S E N A T E
 
                              April 11, 2018
                                ___________
 
 Introduced  by Sen. KAVANAGH -- 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  and  the  banking  law,  in
   relation  to  prohibiting  a  consumer reporting agency or lender from
   using certain information to determine an individual's credit  worthi-
   ness

   THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section 1. Section 380-a of the general business  law  is  amended  by
 adding a new subdivision (u) to read as follows:
   (U) THE TERM "MEMBERS OF A CONSUMER'S SOCIAL NETWORK" MEANS A GROUP OF
 INDIVIDUALS  AUTHORIZED  BY  A  CONSUMER TO BE PART OF HIS OR HER SOCIAL
 MEDIA COMMUNICATIONS AND NETWORK.
   § 2. Section 380-j of the general business law is amended by adding  a
 new subdivision (h) to read as follows:
   (H)  NO  CONSUMER REPORTING AGENCY SHALL COLLECT, EVALUATE, REPORT, OR
 MAINTAIN IN THE FILE ON A CONSUMER THE CREDIT WORTHINESS, CREDIT  STAND-
 ING  OR  CREDIT CAPACITY OF MEMBERS OF THE CONSUMER'S SOCIAL NETWORK FOR
 PURPOSES OF DETERMINING THE CREDIT WORTHINESS OF THE CONSUMER; THE AVER-
 AGE CREDIT WORTHINESS, CREDIT STANDING OR CREDIT CAPACITY OF MEMBERS  OF
 THE  CONSUMER'S  SOCIAL  NETWORK;  OR  ANY  GROUP  SCORE THAT IS NOT THE
 CONSUMER'S OWN CREDIT WORTHINESS, CREDIT STANDING  OR  CREDIT  CAPACITY.
 THE PROVISIONS OF THIS SUBDIVISION SHALL BE ENFORCED CONCURRENTLY BY THE
 SUPERINTENDENT OF FINANCIAL SERVICES AND THE DIRECTOR OF THE DIVISION OF
 CONSUMER  PROTECTION AND EACH SHALL UTILIZE THEIR CONSUMER COMPLAINT AND
 ASSISTANCE HOTLINES TO DOCUMENT COMPLAINTS BY CONSUMERS WHO BELIEVE THAT
 GROUP CREDIT RATINGS OF THEIR SOCIAL MEDIA NETWORK  ARE  BEING  USED  TO
 DENY THEM CREDIT.
   §  3. Section 2 of the banking law is amended by adding a new subdivi-
 sion 31 to read as follows:
   31. MEMBERS OF A BORROWER'S SOCIAL NETWORK. THE  TERM  "MEMBERS  OF  A
 BORROWER'S  SOCIAL NETWORK" MEANS A GROUP OF INDIVIDUALS AUTHORIZED BY A
 BORROWER TO BE PART OF  HIS  OR  HER  SOCIAL  MEDIA  COMMUNICATIONS  AND
 NETWORK.
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets

                       [ ] is old law to be omitted.
                                                            LBD08179-01-7

 S. 8155                             2
 
   §  4.  Section 352 of the banking law is amended by adding a new sixth
 undesignated paragraph to read as follows:
   NO LICENSEE SHALL COLLECT, EVALUATE, REPORT OR MAINTAIN IN THE FILE ON
 A  BORROWER THE CREDIT WORTHINESS, CREDIT STANDING OR CREDIT CAPACITY OF
 MEMBERS OF THE BORROWER'S SOCIAL NETWORK FOR PURPOSES OF DETERMINING THE
 CREDIT WORTHINESS OF THE BORROWER; THE AVERAGE CREDIT WORTHINESS, CREDIT
 STANDING OR CREDIT CAPACITY OF MEMBERS OF THE BORROWER'S SOCIAL NETWORK;
 OR ANY GROUP SCORE THAT IS NOT THE  BORROWER'S  OWN  CREDIT  WORTHINESS,
 CREDIT  STANDING  OR CREDIT CAPACITY.   THE PROVISIONS OF THIS PARAGRAPH
 SHALL BE ENFORCED CONCURRENTLY BY THE SUPERINTENDENT AND THE DIRECTOR OF
 THE DIVISION OF CONSUMER PROTECTION AND EACH SHALL UTILIZE THEIR CONSUM-
 ER COMPLAINT AND ASSISTANCE HOTLINES TO DOCUMENT COMPLAINTS BY BORROWERS
 WHO BELIEVE THAT GROUP CREDIT RATINGS OF THEIR SOCIAL MEDIA NETWORK  ARE
 BEING USED TO DENY THEM CREDIT. THE SUPERINTENDENT SHALL ENSURE THAT THE
 CREDIT  SCORING  FORMULAS FILED WITH THE DEPARTMENT DO NOT CONTAIN VARI-
 ABLES WHICH ACCOUNT FOR INTERNET VIEWING HISTORY AS PART OF THAT FORMULA
 BY ASKING THE LICENSEE TO CERTIFY TO THAT FACT.
   § 5. This act shall take effect immediately.

Comments

Open Legislation is a forum for New York State legislation. All comments are subject to review and community moderation is encouraged.

Comments deemed off-topic, commercial, campaign-related, self-promotional; or that contain profanity, hate or toxic speech; or that link to sites outside of the nysenate.gov domain are not permitted, and will not be published. Attempts to intimidate and silence contributors or deliberately deceive the public, including excessive or extraneous posting/posts, or coordinated activity, are prohibited and may result in the temporary or permanent banning of the user. 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.

Create an account. An account allows you to sign petitions with a single click, officially support or oppose key legislation, and follow issues, committees, and bills that matter to you. When you create an account, you agree to this platform's terms of participation.

Senate Bill S8155

Share this bill

Sponsored By

Brian Kavanagh