S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                  8648--A
 
                        2019-2020 Regular Sessions
 
                           I N  A S S E M B L Y
 
                              October 2, 2019
                                ___________
 
 Introduced by M. of A. DINOWITZ -- read once and referred to the Commit-
   tee  on  Codes  -- recommitted to the Committee on Codes in accordance
   with Assembly Rule 3, sec. 2 -- committee  discharged,  bill  amended,
   ordered reprinted as amended and recommitted to said committee
 
 AN  ACT  to  amend the penal law, in relation to the misappropriation of
   payroll funds
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1. The penal law is amended by adding a new section 165.80 to
 read as follows:
 § 165.80 MISAPPROPRIATION OF PAYROLL FUNDS.
   A PERSON IS GUILTY OF MISAPPROPRIATION OF PAYROLL FUNDS WHEN HE OR SHE
 KNOWS THAT FUNDS ARE DESIGNATED FOR USE AS EMPLOYEE PAYROLL FUNDS OR  AS
 PAYMENT  OF  PAYROLL  TAXES,  AND  INTENTIONALLY PREVENTS THE FUNDS FROM
 BEING USED FOR THEIR DESIGNATED PURPOSE.  A DELAYED TRANSFER  OF  FUNDS,
 IN ACCORDANCE WITH AN AGREEMENT BETWEEN A PAYROLL PROCESSING COMPANY AND
 AN  EMPLOYER  FOR THE PURPOSE OF INVESTIGATING POTENTIALLY FRAUDULENT OR
 INCORRECT TRANSACTIONS, SHALL NOT CONSTITUTE MISAPPROPRIATION OF PAYROLL
 FUNDS. A PAYROLL PROCESSING COMPANY SHALL  NOT  BE  RESPONSIBLE  FOR  AN
 EMPLOYER'S FAILURE TO PROVIDE SUFFICIENT FUNDS.
   MISAPPROPRIATION OF PAYROLL FUNDS IS A CLASS E FELONY.
   § 2. Paragraph (c) of subdivision 2 of section 20.20 of the penal law,
 as  amended  by  chapter  671 of the laws of 1986, is amended to read as
 follows:
   (c) The conduct constituting the offense is engaged in by an agent  of
 the  corporation  while acting within the scope of his OR HER employment
 and in behalf of the corporation, and the offense is (i)  a  misdemeanor
 or  a violation, (ii) one defined by a statute which clearly indicates a
 legislative intent to impose such criminal liability on  a  corporation,
 [or] (iii) any offense set forth in title twenty-seven of article seven-
 ty-one  of  the environmental conservation law, OR (IV) MISAPPROPRIATION
 OF PAYROLL FUNDS AS DEFINED IN SECTION 165.80 OF THIS CHAPTER.
   § 3. This act shall take effect immediately.
 
              

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD13785-03-0