| Date of Action |
Assembly Actions -
Lowercase Senate Actions - UPPERCASE |
|---|---|
| May 25, 2022 |
print number 4332b |
| May 25, 2022 |
amend and recommit to consumer protection |
| Jan 05, 2022 |
referred to consumer protection |
| Jun 02, 2021 |
print number 4332a |
| Jun 02, 2021 |
amend (t) and recommit to consumer protection |
| Feb 03, 2021 |
referred to consumer protection |
Find your Senator and share your views on important issues.
Senate Bill S4332A
2021-2022 Legislative Session
Relates to designating new automotive broker businesses
download bill text pdfSponsored By
(D, IP) Senate District
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
Actions
Bill Amendments
co-Sponsors
(D) Senate District
(D) 26th Senate District
(R, C) 2nd Senate District
2021-S4332 - Details
- See Assembly Version of this Bill:
- A1932
- Current Committee:
- Senate Consumer Protection
- Law Section:
- General Business Law
- Laws Affected:
- Amd §§736, 736-a, 738, 740-a, 741, 741-b & 743, add §§737-a & 741-c, Gen Bus L; amd §415, V & T L
- Versions Introduced in Other Legislative Sessions:
-
2019-2020:
A6655
2023-2024: S5445, A3499
2025-2026: S4981
2021-S4332 - Sponsor Memo
BILL NUMBER: S4332
SPONSOR: SAVINO
TITLE OF BILL:
An act to amend the general business law, the vehicle and traffic law
and the personal property law, in relation to designating new automotive
broker businesses
PURPOSE OR GENERAL IDEA OF BILL:
To decrease the incidents of deceptive practices by automobile broker
businesses who seek to facilitate the sale or lease of motor vehicles.
SUMMARY OF PROVISIONS:
Section 1 amends subdivision 1 of section 736 of the General Business
Law to clarify which types of enterprises are not automobile broker
businesses.
Section 2 amends section 736-a of the General Business-Law to add condi-
tions to an automobile broker business registration and to empower the Department of Motor Vehicles to issue regulations governing such activ- ity. Section 3 adds a new Section 737-a of the General Business Law to require brokers to solicit three bids from dealers on behalf of consum- ers seeking a new motor vehicle and to require DMV to issue regulations enforcing this requirement. Section 4 amends section 738 of the General Business Law to require brokers to have a signed contract before facilitating a sale or lease of a new motor vehicle and to allow consumers to cancel their brokering contract in certain situations, including if an automobile broker busi- ness fails to find a vehicle within thirty (30) days. Section 5 amends section 740-a of the General Business Law to raise the surety bond requirement for brokers. Section 6 amends section 741 of the General Business Law to prohibit brokers from engaging in various forms of deceptive advertising and business practices, including refusing to disclose its DMV or local government registration number or advertising in a way that confuses a consumer as to whether the business is a dealer and not a broker. Section 7 amends section 741-b of the General Business Law to require brokers to disclose fees and consumer rights to consumers, obtain a written acknowledgment from consumers about these rights, and to notify dealers as to the provisions of section 739 of the General Business Law, which provide that contracts that violate Article 35-B are void and unenforceable. Section 8 adds a new section 741-c of the General Business Law to enhance consumer data protections within the automobile brokering indus- try, specifically by requiring brokers to undertake certain physical measures to secure private consumer information and to hold brokers to other relevant General Business Law standards for securing such informa- tion. Section 9 amends section 743 of the General Business Law to increase penalties and authorize local enforcement and new local laws on broker- ing. Section 9 also allows private actions against brokers and awards attorney's fees to prevailing plaintiffs. Section 10 amends subdivision 1 of section 415 of the Vehicle and Traffic Law to clarify the defi- nition of dealer activity to distinguish it from brokering activity. Section 11 amends subdivision 3 of section 415 of the Vehicle and Traf- fic Law to prohibit dealers from using affiliated companies to violate Art. 35-b of the General Business Law. Section 12 amends subdivision 3-a of section 415 of the Vehicle and Traffic Law to add several conditions and prohibitions that relate to an automobile broker business registration, including provisions that require a broker to make certain consumer disclosures. Section 12 also amends paragraph b-three of subdivision three to clarify the broker registration process, including restrictions on the category of business that, or person who may hold an interest in an automobile broker busi- ness. Section 13 amends section 415 of the Vehicle and Traffic Law by adding new two new subdivisions, numbers twenty-one, and twenty-two. Subdivi- sion twenty-one authorizes DMV to penalize automobile broker businesses that fail to register. Subdivision twenty-two requires brokers to keep records for at least six years and authorizes DMV to inspect those records. Section 14 amends section 337 of the Personal Property Law by adding a new subdivision 4-a and a new paragraph (m) to subdivision five. Subdi- vision 4-a requires disclosure of automobile broker business information on any new motor vehicle lease agreement credit application, and para- graph (m) requires disclosure of broker information on any new motor vehicle lease agreement. Section 15 is the bill's severability clause. Section 16 establishes the bill's effective date. JUSTIFICATION: If you have ever bought or leased a car through an automobile broker in New York, you most likely have no idea how much money your broker made off the deal. There is also a very good chance the broker did very little work to find your car, raising the question as to what value a consumer derives from broker services. Brokers regularly deprive consumers of critical information on potential savings because the brokers obscure how much they get paid, which often occurs long after the consumer signs the dotted line. Nor do brokers make a serious attempt to get the best deal, as they typically work only with only one dealer, or an exclusive few, which are often based out-of-state. As a result, consumers get stuck with whatever deal a broker presents and that's been lined up well before a consumer even contacts a broker. Compounding the problem, many brokers advertise like new car dealers, obscuring that they are merely a middleman between the consumer and dealer and violating state laws in the process. . Indeed, right now, hundreds and hundreds of automobile broker businesses continue to oper- ate while flouting basic laws requiring that they register with DMV and make certain consumer disclosures, including that the broker is not an automobile dealer. Many brokers also fail to make even the simplest of efforts to comply with automotive industry standards for consumer data protection. And no broker provides warranty and recall repair services or employs trained workers to educate consumers about vehicle safety features and other options in today's models. Unfortunately, the proliferation of broker businesses has also jeopardized the enormous investments of New York's 1,000 new car dealerships and the security of over 120,000 career-or- iented dealership jobs statewide. In exchange for the right to sell, lease, and service particular new motor vehicle brands, and according to franchise agreements, dealers must maintain high levels of customer satisfaction. Sadly, brokers only serve to skim profits and undercut New York based new car dealers and the entire Franchise System with it. They do this by avoiding capital and facility investments dealers must make, exploiting manufacturer incentive programs that only serve to drive dealerships out of business and reduce. competition, ignoring basic consumer protection laws, and concealing profits from consumers. Beyond the jobs they create, dealers also pay millions in real property taxes, and hundreds of millions in sales tax annually. Dealers also give consumers the knowledge and comfort of dealing with a reputable business supported by a large motor vehicle manufacturer. This legislation favorably addresses these problems to protect consumers and ensure fair market competition by maintaining a clear path for responsible brokering. Specifically, this bill will strengthen the broker registration process, increase disclosures, penalties, and enforcement provisions, and require brokers, for the first time, to work only for consumers, including by requiring brokers to solicit at least three bids on the behalf of a consumer. PRIOR LEGISLATIVE HISTORY: 2021 Session - new bill. (similar to S4364c of 2019/20) FISCAL IMPLICATIONS: None to the state. EFFECTIVE DATE: Immediate, except that all registered brokers shall have ninety (90) days to comply.
2021-S4332 - Bill Text download pdf
S T A T E O F N E W Y O R K
________________________________________________________________________
4332
2021-2022 Regular Sessions
I N S E N A T E
February 3, 2021
___________
Introduced by Sen. SAVINO -- 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, the vehicle and traffic law
and the personal property law, in relation to designating new automo-
tive broker businesses
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision 1 of section 736 of the general business law,
as amended by chapter 28 of the laws of 2018, is amended to read as
follows:
1. "Automobile broker business" means any person who, for a fee,
commission or other valuable consideration, regardless of whether such
fee, commission, or consideration is paid directly by a consumer, offers
to provide, provides, or represents that he or she will provide a
service of purchasing, arranging, assisting, facilitating or effecting
the purchase or lease of an automobile as agent, broker, or intermediary
for a consumer. "Automobile broker business" does not include any person
registered as a NEW MOTOR VEHICLE dealer OR QUALIFIED DEALER pursuant to
article sixteen of the vehicle and traffic law nor any bona fide employ-
ee of a registered NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer while
acting for such NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer, or any
person who sells, offers for sale or lease or acts as agent, broker or
intermediary in effecting the purchase or lease of three or fewer auto-
mobiles in any calendar year, any national service which aggregates
information for consumers, but does not otherwise have contact with
consumers, [or] any motor vehicle franchisor, manufacturer, or distribu-
tor, DISTRIBUTOR BRANCH OR FACTORY BRANCH registered under article
sixteen of the vehicle and traffic law.
§ 2. Section 736-a of the general business law, as added by chapter
477 of the laws of 2017, is amended to read as follows:
§ 736-a. Registration required. 1. (A) No person shall engage in busi-
ness as an automobile broker business, as defined in section seven
hundred thirty-six of this article, without first having been issued a
certificate of registration for an automobile broker business pursuant
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07655-01-1
S. 4332 2
to paragraph c of subdivision seven of section four hundred fifteen of
the vehicle and traffic law. A CERTIFICATE OF REGISTRATION FOR AN AUTO-
MOBILE BROKER BUSINESS SHALL BE VALID FOR A PERIOD OF TWO YEARS.
(B) NO AUTOMOBILE BROKER BUSINESS SHALL REPRESENT OR ACCEPT PAYMENT
FROM, EITHER DIRECTLY OR INDIRECTLY, A FRANCHISEE, DEALER, FRANCHISOR,
MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR FACTORY BRANCH, AS
SUCH TERMS ARE DEFINED IN SECTIONS FOUR HUNDRED FIFTEEN AND FOUR HUNDRED
SIXTY-TWO OF THE VEHICLE AND TRAFFIC LAW.
(C) NO AUTOMOBILE BROKER BUSINESS SHALL PERFORM ANY SERVICES INVOLVING
THE PURCHASING, ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE
PURCHASE OR LEASE OF AN AUTOMOBILE AS AGENT, BROKER, OR INTERMEDIARY FOR
A CONSUMER, UNLESS DONE PURSUANT TO A CONTRACT THAT COMPLIES WITH THE
PROVISIONS OF SECTION SEVEN HUNDRED THIRTY-EIGHT OF THIS ARTICLE.
2. A certificate of registration for an automobile broker business
shall not permit the registrant to display for sale or lease any new or
used motor vehicles without registration as a dealer under section four
hundred fifteen of the vehicle and traffic law.
3. ANY PERSON THAT SELLS OR LEASES FIVE OR MORE VEHICLES IN A CALENDAR
YEAR TO OR THROUGH ONE OR MORE AUTOMOBILE BROKER BUSINESS SHALL BE
DEEMED TO BE DEALING IN MOTOR VEHICLES AS THAT TERM IS USED IN PARAGRAPH
A OF SUBDIVISION ONE OF SECTION FOUR HUNDRED FIFTEEN OF THE VEHICLE AND
TRAFFIC LAW.
4. THE COMMISSIONER OF MOTOR VEHICLES SHALL ADOPT RULES AND REGU-
LATIONS NECESSARY TO EFFECTUATE THE PROVISIONS OF THIS SECTION, INCLUD-
ING REGULATIONS THAT REQUIRE THE DISCLOSURE OF THE NAME, ADDRESS, AND
REGISTRATION NUMBER OF AN AUTOMOBILE BROKER BUSINESS THAT PROVIDED THE
SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE
OR LEASE OF ANY NEW MOTOR VEHICLE, AND THE FEE COLLECTED BY THE BROKER
FROM THE CONSUMER FOR PROVIDING SUCH SERVICE. SUCH RULES AND REGULATIONS
SHALL REQUIRE THAT SUCH INFORMATION OF THE AUTOMOBILE BROKER BUSINESS
AND ITS FEE FOR SERVICE BE PRINTED ON ANY INVOICE, BILL OF SALE, OR
BUYER'S ORDER, AND ON ANY APPLICATION FOR REGISTRATION OR TITLE SUBMIT-
TED BY ANY DEALER TO THE DEPARTMENT OF MOTOR VEHICLES ON BEHALF OF THE
CONSUMER RELATED TO SUCH PURCHASED OR LEASED MOTOR VEHICLE.
§ 3. The general business law is amended by adding a new section 737-a
to read as follows:
§ 737-A. BONA FIDE BID SOLICITING REQUIRED. 1. ON BEHALF OF EACH
CONSUMER EXECUTING A CONTRACT THAT CONFORMS TO THE REQUIREMENTS OF
SUBDIVISION THREE OF SECTION SEVEN HUNDRED THIRTY-EIGHT OF THIS ARTICLE,
AN AUTOMOBILE BROKER BUSINESS SHALL SOLICIT A BID, FROM AT LEAST NEW
MOTOR VEHICLE DEALERS OF THE SAME LINE-MAKE, THAT MEETS THE SPECIFICA-
TIONS OF SUCH PROSPECTIVE BUYER OR LESSEE, INCLUDING FROM THE NEW MOTOR
VEHICLE DEALER LOCATED IN CLOSEST PROXIMITY TO THE HOME ADDRESS OF A
PROSPECTIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE OR, IN THE CASE OF AN
ENTITY, THE PLACE OF DOING BUSINESS OF SUCH PROSPECTIVE BUYER OR LESSEE
OF A NEW MOTOR VEHICLE. WHENEVER AN AUTOMOBILE BROKER BUSINESS MAY
CHOOSE BID SPECIFICATIONS ON BEHALF OF A CONSUMER, SUCH AUTOMOBILE
BROKER BUSINESS SHALL SOLICIT A BID MATCHING SUCH SPECIFICATIONS FROM AT
LEAST THREE NEW MOTOR VEHICLE DEALERS OF THE SAME LINE-MAKE, INCLUDING
FROM THE NEW MOTOR VEHICLE DEALER LOCATED IN CLOSEST PROXIMITY TO THE
HOME ADDRESS OF A PROSPECTIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE OR,
IN THE CASE OF AN ENTITY, THE PLACE OF DOING BUSINESS OF SUCH PROSPEC-
TIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE.
2. AT A MINIMUM, AN AUTOMOBILE BROKER BUSINESS THAT SOLICITS A BID
PURSUANT TO SUBDIVISION ONE OF THIS SECTION SHALL REQUEST THE FOLLOWING
INFORMATION AS PART OF ANY SOLICITATION TO A NEW MOTOR VEHICLE DEALER:
S. 4332 3
(A) PRICE OR LEASE COSTS;
(B) DOWN OR SIMILAR PAYMENT;
(C) NUMBER OF PAYMENTS;
(D) AMOUNT OF INSTALLMENT OR MONTHLY PAYMENTS;
(E) MAKE, MODEL, YEAR OF PRODUCTION, AND COLOR OF ANY AVAILABLE MOTOR
VEHICLE;
(F) WHETHER THE MOTOR VEHICLE HAS ACCESSORIES SPECIFICALLY REQUESTED
BY THE CONSUMER;
(G) FEES;
(H) WHERE APPLICABLE, FINANCE CHARGES AND/OR ANNUAL PERCENTAGE RATE;
(I) ESTIMATED DELIVERY DATE OF THE AUTOMOBILE;
(J) STATEMENT OF WHETHER OR NOT THE MANUFACTURER'S WARRANTY ACCOMPANY-
ING THE MOTOR VEHICLE IS THE SAME WARRANTY AS THAT FURNISHED TO PURCHAS-
ERS OF THE SAME MOTOR VEHICLE BY AN AUTHORIZED DEALER; AND
(K) THE IDENTITY OF THE NEW MOTOR VEHICLE DEALER OFFERING A BID.
3. THE CONTENTS OF EACH BID BY A MOTOR VEHICLE DEALER, SOLICITED
PURSUANT TO SUBDIVISION ONE OF THIS SECTION, SHALL BE PROVIDED TO EACH
CONSUMER ON WHOSE BEHALF SUCH BID HAS BEEN SOLICITED, REGARDLESS OF THE
PARTICULARS OR CONTENT OF ANY SUCH BID.
4. THE COMMISSIONER OF MOTOR VEHICLES SHALL ADOPT RULES AND REGU-
LATIONS NECESSARY TO EFFECTUATE THE PROVISIONS OF THIS SECTION.
§ 4. The opening paragraph and paragraph (e) of subdivision 1 and
subdivisions 3 and 4 of section 738 of the general business law, the
opening paragraph and paragraph (e) of subdivision 1 as amended and
subdivision 4 as added by chapter 28 of the laws of 2018 and subdivision
3 as amended by chapter 477 of the laws of 2017, are amended to read as
follows:
Every contract between a consumer and an automobile broker business
for the purchase of [an automobile] A MOTOR VEHICLE, OTHER THAN A NEW
MOTOR VEHICLE, shall be in writing, shall be dated, shall contain the
street address of the automobile broker business and the consumer and
shall be signed by the consumer and by the automobile broker business.
Every contract shall comply with the requirements set forth in this
section and contain the following:
(e) A description of any other services and an itemization of the
charges for each. Such description shall include disclosure of the auto-
mobile dealer from which the automobile was purchased, as well as all
fees, commissions or other valuable [considerations paid by an automo-
bile dealer] CONSIDERATION OWED BY THE CONSUMER to the automobile broker
business for selling, arranging, assisting or effecting the sale of an
automobile as agent, broker, or intermediary between the consumer and
the automobile dealer.
3. EVERY CONTRACT BETWEEN A CONSUMER AND AN AUTOMOBILE BROKER BUSINESS
FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE
PURCHASE OR LEASE OF A NEW MOTOR VEHICLE SHALL BE IN WRITING, SHALL BE
DATED, SHALL CONTAIN THE STREET ADDRESS OF THE AUTOMOBILE BROKER BUSI-
NESS AND THE CONSUMER, AND SHALL BE SIGNED BY THE CONSUMER AND BY THE
AUTOMOBILE BROKER BUSINESS. EVERY SUCH CONTRACT SHALL COMPLY WITH THE
REQUIREMENTS SET FORTH IN THIS SECTION AND CONTAIN THE FOLLOWING
PROVISIONS, WHICH SHALL BE PRINTED IN AT LEAST TWELVE-POINT BOLD TYPE
AND SHALL NOT BE NEGATED OR SUPERSEDED BY ANY ADDITIONAL PROVISION:
(A) A TITLE, ACROSS THE TOP OF THE DOCUMENT IN AT LEAST SIXTEEN-POINT
BOLD TYPE, OF "CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW
MOTOR VEHICLE".
(B) A STATEMENT OF WHETHER A SOLICITED NEW MOTOR VEHICLE IS OR WILL BE
MANUFACTURED IN ACCORDANCE WITH UNITED STATES SPECIFICATIONS AND IS OR
S. 4332 4
WILL BE CERTIFIED BY THE MANUFACTURER AS SUCH IF THE NEW MOTOR VEHICLE
IS NOT OR WILL NOT BE MANUFACTURED IN ACCORDANCE WITH UNITED STATES
SAFETY AND ENVIRONMENTAL SPECIFICATIONS, AND THE CONSUMER HAS RETAINED
THE AUTOMOBILE BROKER BUSINESS TO ARRANGE FOR THE MODIFICATION OF THE
NEW MOTOR VEHICLE TO MEET SUCH SPECIFICATIONS, THE NAME AND STREET
ADDRESS OF THE MODIFICATION FACILITY AND A STATEMENT IN IMMEDIATE PROX-
IMITY TO SUCH INFORMATION THAT THE AUTOMOBILE BROKER BUSINESS ASSUMES
FULL FINANCIAL RESPONSIBILITY THAT THE NEW MOTOR VEHICLE WILL BE PROPER-
LY MODIFIED TO MEET ALL UNITED STATES SAFETY AND ENVIRONMENTAL SPECIFI-
CATIONS.
(C) A STATEMENT THAT THE CONSUMER MAY CANCEL THE CONTRACT FOR AUTOMO-
BILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE FOR ANY REASON WITHIN
THREE DAYS OF THE EXECUTION OF SUCH CONTRACT AND THAT THE CONSUMER HAS
THE RIGHT TO A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING RECEIPT OF
THE NOTICE OF CANCELLATION.
(D) A STATEMENT THAT, IF THE REQUESTED NEW MOTOR VEHICLE CANNOT BE
PROCURED BY THE AUTOMOBILE BROKER BUSINESS WITHIN THIRTY DAYS FOLLOWING
THE DATE OF EXECUTION OF THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES
FOR A NEW MOTOR VEHICLE, THE CONSUMER HAS THE RIGHT TO CANCEL THE
CONTRACT AND TO RECEIVE A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING
RECEIPT OF THE REQUEST FOR A REFUND, UNLESS THE DELAY IN DELIVERY IS
ATTRIBUTABLE TO THE CONSUMER.
(E) A STATEMENT THAT THE CONSUMER SHALL BE PROVIDED WITH THE CONTENTS
OF EACH BID RECEIVED BY THE AUTOMOBILE BROKER BUSINESS IN RESPONSE TO
ITS SOLICITATION ON BEHALF OF SUCH CONSUMER.
(F) THE AMOUNT OF THE FEE TO BE PAID BY THE CONSUMER TO THE AUTOMOBILE
BROKER BUSINESS FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR
EFFECTING THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE.
(G) A STATEMENT THAT THE SINGLE FEE AUTHORIZED BY SUCH CONTRACT FOR
AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE IS INCLUSIVE OF
ALL CHARGES INCIDENT TO THE PURCHASING, ARRANGING, ASSISTING, FACILITAT-
ING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHICLE BY THE
AUTOMOBILE BROKER BUSINESS AS AGENT, BROKER, OR INTERMEDIARY AND THAT NO
OTHER CHARGE OR EXPENSE WHATSOEVER SHALL BE TAKEN, RECEIVED, RESERVED OR
CONTRACTED FOR BY THE AUTOMOBILE BROKER BUSINESS FOR SUCH SERVICES.
4. THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR
VEHICLE SHALL BE ACCOMPANIED BY A COMPLETED FORM IN DUPLICATE, CAPTIONED
"NOTICE OF CANCELLATION" WHICH SHALL BE ATTACHED TO THE CONTRACT AND
EASILY DETACHABLE, AND WHICH SHALL CONTAIN IN AT LEAST TWELVE-POINT TYPE
THE FOLLOWING:
"NOTICE OF CANCELLATION
YOU MAY CANCEL THIS CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A
NEW MOTOR VEHICLE, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN THREE DAYS
FROM THE DATE THAT A COPY OF AN EXECUTED CONTRACT IS RECEIVED BY YOU.
YOU MAY ALSO CANCEL THIS CONTRACT, WITHOUT PENALTY OR OBLIGATION, IF THE
AUTOMOBILE BROKER BUSINESS DOES NOT PRODUCE A BID MEETING YOUR SPECIFI-
CATIONS WITHIN THIRTY DAYS OF THE DATE OF EXECUTION OF THIS CONTRACT.
TO CANCEL THIS CONTRACT, MAIL OR DELIVER A SIGNED AND DATED COPY OF
THIS CANCELLATION NOTICE, OR ANY OTHER WRITTEN NOTICE, TO (NAME OF AUTO-
MOBILE BROKER BUSINESS) AT (ADDRESS OF AUTOMOBILE BROKER BUSINESS) NOT
LATER THAN MIDNIGHT OF THE THIRD DAY FOLLOWING YOUR RECEIPT OF A SIGNED
CONTRACT.
I HEREBY CANCEL THIS TRANSACTION.
________________________________ (SIGNATURE OF CONSUMER)
_____________________ (DATE)"
S. 4332 5
5. An automobile broker business shall deliver to the consumer or mail
to him or her at the address shown on [the] ANY contract REQUIRED BY
THIS SECTION , an executed copy thereof.
[4. An] 6. IN ADDITION TO THE BROKERING SERVICES AGREEMENT REQUIRED BY
SUBDIVISION ONE OF THIS SECTION, AN automobile broker business in any
transaction involving the lease of a vehicle shall provide the retail
lessee with a retail lease agreement as provided for in section three
hundred thirty-seven of the personal property law. [The automobile
broker shall provide a written disclosure of the amount of any fee,
commission or other consideration paid or expected to be paid by the
lessor to the automobile broker business in connection with a trans-
action involving the lease of a vehicle. Such disclosure shall be signed
by the retail lessee. The automobile broker business shall provide the
retail lessee with a signed copy of such disclosure together with the
retail lease agreement referenced herein.] NOTHING IN THIS SECTION SHALL
BE CONSTRUED TO PERMIT THE DELIVERY OF AN EXECUTED RETAIL LEASE AGREE-
MENT TO A NEW MOTOR VEHICLE BY A PERSON OTHER THAN THE PROSPECTIVE
LESSEE.
§ 5. Subdivision 1 of section 740-a of the general business law, as
amended by chapter 477 of the laws of 2017, is amended to read as
follows:
1. Automobile broker businesses shall obtain and continue in effect a
surety bond in an amount of [one] TWO hundred FIFTY thousand dollars
executed by a surety company authorized to transact business in the
state by the department of financial services of the state or its
successor. The bonds shall be approved as to form by the secretary of
state and shall be conditioned on the automobile broker business'
payment of all valid bank drafts, including checks, drawn for the
purchase of motor vehicles and safekeeping of all customer deposits
related to the sale of a motor vehicle between the time of receipt of
such customer deposit and the transfer of good title to the vehicle to
the customer.
§ 6. Section 741 of the general business law, as added by chapter 616
of the laws of 1988, is amended to read as follows:
§ 741. Deceptive acts AND FRAUDS prohibited. 1. It is hereby declared
to be a deceptive trade practice and unlawful for an automobile broker
business to misrepresent directly or indirectly in its advertising,
promotional materials, sales presentation, or in any manner:
[1.] (A) The nature of the services to be performed AND THAT A THIRD
PARTY WILL BE PAYING FOR ANY SUCH SERVICES;
[2.] (B) The time within which the services will be performed;
[3.] (C) The cost of the services to be performed; [and
4.] (D) The ability of the automobile broker business to perform the
services; AND
(E) THAT THE AUTOMOBILE BROKER BUSINESS IS AFFILIATED WITH ANY NEW
MOTOR VEHICLE MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR
FACTORY BRANCH INCLUDING THE USE OF ANY TRADEMARKS OR COPYRIGHTED MATE-
RIAL WITHOUT THE EXPRESS, WRITTEN CONSENT OF THE OWNER OF SUCH MATERIAL.
2. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO REFUSE TO DISCLOSE ITS REGISTRATION NUMBER, ISSUED EITHER BY
THE STATE OR A MUNICIPALITY, TO A MOTOR VEHICLE DEALER. FURTHERMORE, IT
SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSI-
NESS TO MAKE ANY MISREPRESENTATION TO A MOTOR VEHICLE DEALER OR NEW
MOTOR VEHICLE DEALER REGARDING THE ELIGIBILITY OF ANY CONSUMER FOR ANY
DISCOUNTS, REDUCTIONS OR ANY BENEFIT PROGRAMS REGARDING THE SALE OR
LEASE OF A MOTOR VEHICLE.
S. 4332 6
3. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO ADVERTISE NEW MOTOR VEHICLES, THROUGH ANY PRINT, ELECTRONIC
OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD,
DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM,
WITHOUT DISCLOSING THAT IT IS NOT A LICENSED MOTOR VEHICLE DEALER AND IS
NOT AN AUTHORIZED SATELLITE LOCATION FOR ANY PARTICULAR LICENSED MOTOR
VEHICLE DEALER.
4. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO ADVERTISE THROUGH ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR
MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR
ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM, THAT WOULD LEAD A REASON-
ABLE CONSUMER TO CONCLUDE THAT THE AUTOMOBILE BROKER BUSINESS IS A
LICENSED NEW MOTOR VEHICLE DEALER.
5. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO MAINTAIN ANY WEBSITE WITHOUT INCLUDING A TEXT BOX WITH THE
FOLLOWING STATEMENT IN NO LESS THAN EIGHTEEN-POINT BOLDFACE TYPE ON THE
SPLASH PAGE: "(BROKER NAME) IS NOT A LICENSED NEW MOTOR VEHICLE DEALER
IN THE STATE OF NEW YORK, NOR IS IT AN AUTHORIZED AFFILIATE OF ANY
LICENSED NEW MOTOR VEHICLE DEALER IN THE STATE OF NEW YORK".
6. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO INCLUDE ANY PRICING OR FINANCING OFFERS OR PROMOTIONS IN ANY
ADVERTISEMENT, INCLUDING ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR
MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR
ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM.
7. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER
BUSINESS TO GAIN ACCESS TO OR USE, OR REPRESENT OR ADVERTISE THAT IT MAY
ACCESS OR USE, A PORTAL, COMPUTER, OR INTERNET ACCOUNT OWNED BY OR
RESERVED FOR A NEW MOTOR VEHICLE DEALER TO ACCESS OR USE ONE OR MORE
FINANCE SOURCES THAT PROVIDE AUTOMOTIVE-RELATED LOANS, OR PURCHASES
RETAIL INSTALLMENT CONTRACTS OR LEASE CONTRACTS FOR MOTOR VEHICLES.
§ 7. Section 741-b of the general business law, as added by chapter 28
of the laws of 2018, is amended to read as follows:
§ 741-b. [Disclosure] DISCLOSURES REQUIRED BY BROKERS. 1. An automo-
bile broker business shall GENERATE AND provide a disclosure at the time
such automobile broker business takes an order to search for a leased OR
PURCHASED vehicle meeting the prospective BUYER OR lessee's specifica-
tions. Such disclosure shall provide the amount of any fees, commissions
or other valuable consideration the automobile broker business expects
to receive, if known, from [a dealer, lessor or] any [other] person or
entity for any assistance the automobile broker business provides in
effecting the PURCHASE OR lease transaction. If the amount of any such
fees, commissions or other valuable consideration the automobile broker
business expects to receive is unknown at the time of the required
disclosure, the automobile broker business shall disclose[: (a)] whether
it has a contract with any dealer, lessor or any other person or entity
for the provision of assistance in effecting a PURCHASE OR lease trans-
action[; and (b) whether the automobile broker business may be compen-
sated by the dealer, lessor or any other person or entity for any
assistance in effecting such lease transaction]. NOTHING IN THIS SUBDI-
VISION SHALL BE CONSTRUED TO PERMIT THE PAYMENT OF ANY FEES, COMMISSIONS
OR OTHER VALUABLE CONSIDERATION TO AN AUTOMOBILE BROKER BUSINESS BY ANY
MOTOR VEHICLE DEALER.
2. AN AUTOMOBILE BROKER BUSINESS SHALL GENERATE AND PROVIDE AN ADDI-
TIONAL DISCLOSURE TO THE CONSUMER AT THE TIME SUCH AUTOMOBILE BROKER
BUSINESS TAKES AN ORDER TO SEARCH FOR A MOTOR VEHICLE MEETING THE
S. 4332 7
PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS. SUCH ADDITIONAL DISCLOSURE
SHALL STATE THE FOLLOWING:
(A) THAT THE AUTOMOBILE BROKER BUSINESS SHALL MAKE A BONA FIDE ATTEMPT
TO OBTAIN A BID, QUOTE OR OFFER FROM AT LEAST THREE UNAFFILIATED DEALERS
ON BEHALF OF THE PROSPECTIVE BUYER OR LESSEE FOR A MOTOR VEHICLE MEETING
THE PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS, INCLUDING FROM THE NEW
MOTOR VEHICLE DEALER OF SUCH LINE-MAKE LOCATED CLOSEST TO THE HOME OR
PLACE OF BUSINESS OF SUCH PROSPECTIVE BUYER FOR A CONSUMER THAT SEEKS A
NEW MOTOR VEHICLE;
(B) THAT THE AUTOMOBILE BROKER BUSINESS SHALL PROVIDE TO THE CONSUMER
ALL CONTENTS OF EACH BID MADE BY A MOTOR VEHICLE DEALER IN RESPONSE TO
THE SOLICITATION OF THE AUTOMOBILE BROKER BUSINESS; AND
(C) THAT THE AUTOMOBILE BROKER BUSINESS HAS A DUTY TO ACT FOR THE
BENEFIT OF THE PROSPECTIVE BUYER OR LESSEE.
3. EACH DISCLOSURE REQUIRED BY THIS SECTION TO BE MADE TO A CONSUMER
SHALL BE ACKNOWLEDGED IN WRITING BY EACH CONSUMER.
4. AT THE TIME AN AUTOMOBILE BROKER BUSINESS SOLICITS A BID FROM A NEW
MOTOR VEHICLE DEALER IN THE MANNER DESCRIBED IN SECTION SEVEN HUNDRED
THIRTY-SEVEN-A OF THIS ARTICLE, SUCH BROKER SHALL PROVIDE A DISCLOSURE
TO EACH SOLICITED DEALER AS TO THE PROVISIONS OF SECTION SEVEN HUNDRED
THIRTY-NINE OF THIS ARTICLE.
5. PRIOR TO THE EXECUTION OF ANY PURCHASE CONTRACT OR LEASE FOR AN
AUTOMOBILE, AN AUTOMOBILE BROKER BUSINESS SHALL PROVIDE EACH CONSUMER
WITH ALL DISCLOSURES REQUIRED TO BE MADE BY A DEALER.
§ 8. The general business law is amended by adding a new section 741-c
to read as follows:
§ 741-C. PRIVATE INFORMATION SECURITY. 1. AN AUTOMOBILE BROKER BUSI-
NESS SHALL REPORT ANNUALLY TO THE DEPARTMENT OF MOTOR VEHICLES ITS
COMPLIANCE WITH SECTIONS THREE HUNDRED NINETY-NINE-CC, THREE HUNDRED
NINETY-NINE-DD, THREE HUNDRED NINETY-NINE-DDD, THREE HUNDRED NINETY-
NINE-H, THREE HUNDRED NINETY-NINE-OO, THREE HUNDRED NINETY-NINE-P, THREE
HUNDRED NINETY-NINE-PP, AND EIGHT HUNDRED NINETY-NINE-BB OF THIS CHAP-
TER. FOR THE PURPOSES OF SUBDIVISION TWO OF SECTION EIGHT HUNDRED NINE-
TY-NINE-BB OF THIS CHAPTER, AN AUTOMOBILE BROKER BUSINESS SHALL NOT BE
CONSIDERED A SMALL BUSINESS AS THAT TERM IS DEFINED IN THAT SECTION AND
SHALL INSTEAD BE SUBJECT TO REASONABLE SECURITY REQUIREMENTS THAT ARE
EQUIVALENT TO THOSE APPLICABLE TO NEW MOTOR VEHICLE DEALERS.
2. IN ADDITION TO THE REQUIREMENTS OF SUBDIVISION ONE OF THIS SECTION,
AN AUTOMOBILE BROKER BUSINESS SHALL:
(A) KEEP AND MAINTAIN ALL CONSUMER RECORDS CONTAINING PRIVATE INFORMA-
TION IN A SAFE PLACE THAT IS NOT ACCESSIBLE TO PERSONS NOT EMPLOYED BY
THE AUTOMOBILE BROKER BUSINESS, INCLUDING BY KEEPING AND MAINTAINING A
CLEAR AND PERMANENT PHYSICAL BARRIER FROM OTHER BUSINESSES THAT SHARE OR
NEIGHBOR ITS PLACE OF BUSINESS;
(B) HAVE A MAILBOX AT SUCH PLACE OF BUSINESS DEDICATED ONLY TO THE
AUTOMOBILE BROKER BUSINESS; AND
(C) HAVE A METHOD OF LOCKING SECURITY ITEMS, INCLUDING A LOCKING CABI-
NET OR SAFE.
3. NO TRANSACTION FOR THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE
THAT WAS ARRANGED, ASSISTED, FACILITATED OR EFFECTED BY AN AUTOMOBILE
BROKER BUSINESS SHALL BE VALID UNLESS THE CONSUMER PERSONALLY DELIVERS
AN EXECUTED PURCHASE CONTRACT OR LEASE, AND, WHERE APPLICABLE, FINANCING
AGREEMENT, TO THE PLACE OF BUSINESS OF THE DEALER FROM WHICH SUCH VEHI-
CLE WILL BE PURCHASED OR LEASED AND SUCH DEALER VERIFIES THE IDENTITY OF
SUCH CONSUMER.
S. 4332 8
§ 9. Section 743 of the general business law, as amended by chapter
372 of the laws of 2016, is amended to read as follows:
§ 743. Enforcement [by]. 1. BY attorney general. In addition to the
other remedies provided, whenever there shall be a violation of this
article, application may be made by the attorney general in the name of
the people of the state of New York to a court or justice having juris-
diction by a special proceeding to issue an injunction, and upon notice
to the defendant of not less than five days, to enjoin and restrain the
continuance of such violations; and if it shall appear to the satisfac-
tion of the court or justice that the defendant has, in fact, violated
this article, an injunction may be issued by such court or justice,
enjoining and restraining any further violation, without requiring proof
that any person has, in fact, been injured or damaged thereby. In any
such proceeding, the court may make allowances to the attorney general
as provided in paragraph six of subdivision (a) of section eighty-three
hundred three of the civil practice law and rules, and direct restitu-
tion. Whenever the court shall determine that a violation of this arti-
cle has occurred, the court shall impose a civil penalty of not less
than [one] FOUR thousand dollars and not more than [three] TEN thousand
dollars for each violation. In connection with any such proposed appli-
cation, the attorney general is authorized to take proof and make a
determination of the relevant facts and to issue subpoenas in accordance
with the civil practice law and rules.
2. BY LOCAL AUTHORITIES. (A) MUNICIPALITIES MAY, PURSUANT TO LOCAL
LAW, ACT UPON THE BUSINESS ACTIVITY THAT IS THE SUBJECT OF THIS ARTICLE,
PROVIDED THAT NO LOCAL GOVERNMENT MAY DIMINISH THE PROTECTIONS OR
REQUIREMENTS OF THIS ARTICLE OR PREVENT ENFORCEMENT OF ITS PROVISIONS BY
APPROPRIATE STATE OFFICIALS.
(B) THE PROVISIONS OF THIS ARTICLE MAY BE ENFORCED IN THE SAME MANNER
AS SET FORTH IN SUBDIVISION ONE OF THIS SECTION BY THE DIRECTOR OF A
MUNICIPAL CONSUMER AFFAIRS OFFICE OR A BUSINESS INTEGRITY COMMISSION, OR
BY THE TOWN ATTORNEY, CITY CORPORATION COUNSEL, OR OTHER LAWFULLY DESIG-
NATED ENFORCEMENT OFFICER OF A MUNICIPALITY OR LOCAL GOVERNMENT, AND ALL
MONIES COLLECTED THEREUNDER SHALL BE RETAINED BY SUCH MUNICIPALITY OR
LOCAL GOVERNMENT, PROVIDED THAT NO LOCAL GOVERNMENT MAY PREVENT ENFORCE-
MENT OF ITS PROVISIONS BY APPROPRIATE STATE OFFICIALS.
3. BY PRIVATE PARTY. ANY PERSONS THAT ARE OR MAY BE INJURED BY ANY
VIOLATION OF THIS ARTICLE MAY BRING AN ACTION IN HIS OR HER OWN NAME
AGAINST AN AUTOMOBILE BROKER BUSINESS TO ENJOIN SUCH UNLAWFUL ACT OR
PRACTICE, AN ACTION TO RECOVER HIS OR HER DAMAGES AND STATUTORY DAMAGES
OF NOT LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND
DOLLARS FOR EACH VIOLATION, OR BOTH SUCH ACTIONS. INJURY SHALL INCLUDE,
BUT NOT BE LIMITED TO, LOST SALES ON ACCOUNT OF DECEPTIVE OR UNFAIR
ADVERTISING AND DEPRIVING A NEW MOTOR VEHICLE DEALER LOCATED CLOSEST TO
A LESSEE OR PURCHASER THE OPPORTUNITY TO BID ON SUCH LEASE OR PURCHASE
AS ENTITLED BY THIS ARTICLE. DAMAGES SHALL INCLUDE, BUT NOT BE LIMITED
TO, LOST SALES AND THE VALUE OF INCENTIVE PAYMENTS, BONUSES, HOLDBACKS
OR SIMILAR PAYMENTS THAT WOULD HAVE BEEN REALIZED HAD A LESSEE OR
PURCHASER PURCHASED OR LEASED SUCH VEHICLE FROM THE NEW MOTOR VEHICLE
DEALER IN CLOSEST PROXIMITY TO SUCH LESSEE OR PURCHASER BUT FOR THE
ACTIONS OF A PERSON WHO KNOWINGLY AIDED THE VIOLATION OF THE PROVISIONS
OF THIS ARTICLE. NOTHING IN THIS SECTION SHALL REQUIRE A FRANCHISOR,
MANUFACTURER, OR DISTRIBUTOR TO GRANT A NEW MOTOR VEHICLE DEALER A BENE-
FIT UNDER AN INCENTIVE, BONUS, HOLDBACK OR SIMILAR PAYMENT THAT THE NEW
MOTOR VEHICLE DEALER DID NOT EARN OR FOR WHICH THE NEW MOTOR VEHICLE
DEALER DID NOT QUALIFY. SUCH ACTIONS MAY BE BROUGHT REGARDLESS OF WHETH-
S. 4332 9
ER OR NOT THE UNDERLYING VIOLATION IS CONSUMER-ORIENTED OR HAS A PUBLIC
IMPACT. GIVEN THE REMEDIAL NATURE OF THIS SUBDIVISION, STANDING TO BRING
AN ACTION UNDER THIS SUBDIVISION SHALL BE LIBERALLY CONSTRUED AND SHALL
BE AVAILABLE TO THE FULLEST EXTENT OTHERWISE PERMITTED BY LAW. THE COURT
MAY, IN ITS DISCRETION, AWARD TREBLE DAMAGES IF THE COURT FINDS THE
DEFENDANT WILLFULLY OR KNOWINGLY VIOLATED THIS ARTICLE. THE COURT SHALL
AWARD REASONABLE ATTORNEY'S FEES AND COSTS TO A PREVAILING PLAINTIFF.
§ 10. Paragraph a of subdivision 1 of section 415 of the vehicle and
traffic law, as amended by chapter 554 of the laws of 2015, is amended
to read as follows:
a. "Dealer" means a person engaged in the business of buying, selling
or dealing in motor vehicles, motorcycles or trailers, other than mobile
homes or manufactured homes, at retail or wholesale; except, however,
trailers with an unladen weight of less than one thousand pounds. For
the purposes of this section, a "mobile home" or "manufactured home"
means a mobile home or manufactured home as defined in section one
hundred twenty-two-c of this chapter. Any person who sells, or offers
for sale OR LEASE more than five motor vehicles, motorcycles or trailers
in any calendar year or who displays or permits the display of three or
more motor vehicles, motorcycles or trailers for sale at any one time or
within any one calendar month upon premises owned or controlled by him
or her, if such vehicles were purchased, acquired or otherwise obtained
by such person for the purpose of resale, will be regarded as a dealer.
FOR THE PURPOSES OF THIS SECTION, "OFFERS FOR SALE OR LEASE" SHALL
INCLUDE, BUT NOT BE LIMITED TO, THE ACT OF DRAWING THE PUBLIC'S ATTEN-
TION TO, OR THE PRESENTATION OR DISPLAY OF ANY MOTOR VEHICLE, INCLUDING
THE POSTING OF IMAGES OF ANY SUCH VEHICLE, TOGETHER WITH A SUGGESTED
RETAIL PRICE, LEASE COST OR FINANCING RATE FOR SUCH VEHICLE AND AN OFFER
TO PROVIDE, THE PROVISION OF, OR A REPRESENTATION THAT SUCH PERSON MAY
PROVIDE A SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE
LEASE OF SUCH NEW MOTOR VEHICLE, EXCEPT THIS MEANING SHALL NOT APPLY TO
ANY ACTIVITY OF A COOPERATIVE OR OTHER ADVERTISING PROGRAM OR FUND AS
DESCRIBED IN ANY FRANCHISE, AS SUCH TERM IS DEFINED BY SUBDIVISION SIX
OF SECTION FOUR HUNDRED SIXTY-TWO OF THIS TITLE, OR THE DISPLAY OF
AGGREGATED INFORMATION AND IMAGES BY A NATIONAL SERVICE THAT OTHERWISE
DOES NOT HAVE CONTACT WITH CONSUMERS. Except as otherwise provided in
subdivisions three, five, six-b, and seven of this section, the term
"dealer" shall include a "new motor vehicle dealer" as defined by para-
graph f of this subdivision and a "qualified dealer" as defined in para-
graph g of this subdivision.
§ 11. Subdivision 3 of section 415 of the vehicle and traffic law is
amended by adding a new paragraph d to read as follows:
D. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES
OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR A DEALER TO USE
ANY SUBSIDIARY CORPORATION, AFFILIATED CORPORATION, OR ANY OTHER
CONTROLLED CORPORATION, PARTNERSHIP, ASSOCIATION, BUSINESS OR PERSON TO
ACCOMPLISH WHAT WOULD OTHERWISE BE UNLAWFUL CONDUCT UNDER THIS ARTICLE
OR ARTICLE THIRTY-FIVE-B OF THE GENERAL BUSINESS LAW, INCLUDING REQUEST-
ING THAT AN AUTOMOBILE BROKER BUSINESS REPRESENT SUCH DEALER IN GENERAT-
ING A SALE OR LEASE OR MAKING PAYMENT TO, EITHER DIRECTLY OR INDIRECTLY,
AN AUTOMOBILE BROKER BUSINESS.
§ 12. Subdivision 3-a and paragraph b-3 of subdivision 5 of section
415 of the vehicle and traffic law, as added by chapter 477 of the laws
of 2017, are amended to read as follows:
3-a. Automobile broker business registration. A. No person shall
engage in the automobile broker business or represent or advertise that
S. 4332 10
he or she is engaged or intends to engage in the automobile broker busi-
ness in this state, unless there shall have been issued to him or her a
certificate of registration as an automobile broker business by the
commissioner under this section pursuant to an application for registra-
tion submitted pursuant to subdivision five of this section. SUCH REGIS-
TRATION SHALL BE EFFECTIVE FOR A PERIOD NOT EXCEEDING TWO YEARS. AT THE
DISCRETION OF THE COMMISSIONER A REGISTRATION MAY BE RENEWED FOR A PERI-
OD OF UP TO TWO YEARS UPON APPLICATION THEREFOR, IN SUCH FORM AS THE
COMMISSIONER MAY PRESCRIBE, AND A SHOWING OF PROOF OF SATISFACTION OF
THE REQUIREMENTS OF SECTION SEVEN HUNDRED FORTY-A OF THE GENERAL BUSI-
NESS LAW, AND UPON PAYMENT OF THE FEE AS HEREIN PRESCRIBED.
B. THE COMMISSIONER SHALL NOT ISSUE OR RENEW A CERTIFICATE OF REGIS-
TRATION AUTHORIZED BY THIS SUBDIVISION TO ANY DEALER, FRANCHISEE, FRAN-
CHISOR, MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH OR FACTORY BRANCH,
AS SUCH TERMS ARE DEFINED IN SECTION FOUR HUNDRED SIXTY-TWO OF THIS
TITLE, OR TO ANY SUBSIDIARY, AFFILIATE, EMPLOYEE OR CONTROLLED PERSON OR
ENTITY THEREOF.
C. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED
PURSUANT TO THIS SUBDIVISION, AN AUTOMOBILE BROKER BUSINESS SHALL HAVE,
AND CONTINUOUSLY MAINTAIN, A PLACE OF BUSINESS IN THIS STATE FOR WHICH
IT SHALL KEEP AND MAINTAIN EVIDENCE THAT ALL NECESSARY APPROVALS,
LICENSES AND/OR PERMITS HAVE BEEN OBTAINED FROM ALL LOCAL GOVERNING
BODIES TO OPERATE SUCH PLACE OF BUSINESS WITH CUSTOMER OR CLIENT TRAF-
FIC. NO MORE THAN ONE AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT ANY
SINGLE LOCATION AND NO AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT THE
SAME LOCATION AS A NEW MOTOR VEHICLE DEALER.
D. EVERY REGISTERED AUTOMOBILE BROKER BUSINESS SHALL PROMINENTLY AND
CONSPICUOUSLY POST, IN SUCH A MANNER THAT IT IS LIKELY TO BE NOTICEABLE
TO ANYONE ENTERING ITS PREMISES, ITS OFFICIAL BUSINESS CERTIFICATE OF
REGISTRATION AND A SIGN, WHICH SIGN SHALL CLEARLY STATE:
"(NAME OF REGISTERED AUTOMOBILE BROKER) IS NOT A FRANCHISED NEW MOTOR
VEHICLE DEALER. WE ARE NOT AUTHORIZED OR APPROVED BY A MANUFACTURER OR
DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM RECALL OR ORIGINAL
FACTORY WARRANTY WORK. IF YOU ORDER A SEARCH FOR A NEW MOTOR VEHICLE
FROM THIS BROKER, WE MUST MAKE A BONA FIDE EFFORT TO SOLICIT BIDS FROM
AT LEAST THREE UNAFFILIATED NEW MOTOR VEHICLE DEALERS FOR A NEW MOTOR
VEHICLE ON YOUR BEHALF, INCLUDING FROM YOUR LOCAL DEALER."
E. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED
PURSUANT TO THIS SUBDIVISION, AND BEFORE PERFORMING ANY BROKER SERVICES
RELATED TO A NEW MOTOR VEHICLE, AN AUTOMOBILE BROKER BUSINESS SHALL
ATTEST IN WRITING TO EACH CONSUMER, THAT THE BROKER: (I) IS NOT A FRAN-
CHISED NEW MOTOR VEHICLE DEALER; (II) IS NOT AUTHORIZED OR APPROVED BY A
MANUFACTURER OR DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM
RECALL OR ORIGINAL FACTORY WARRANTY WORK; AND (III) THAT THE BROKER
SHALL MAKE A BONA FIDE EFFORT TO SOLICIT BIDS FROM AT LEAST THREE UNAF-
FILIATED NEW MOTOR VEHICLE DEALERS THAT SELL A NEW MOTOR VEHICLE OR ANY
LINE OR MAKE DESIRED BY SUCH CONSUMER, INCLUDING FROM THE CONSUMER'S
LOCAL DEALER.
F. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES
OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR AN AUTOMOBILE
BROKER BUSINESS TO DRAW THE PUBLIC'S ATTENTION TO, OR PRESENT OR DISPLAY
ANY NEW MOTOR VEHICLE, INCLUDING BY POSTING IMAGES OF ANY SUCH VEHICLE,
TOGETHER WITH A SUGGESTED RETAIL PRICE, LEASE COST OR FINANCING RATE FOR
SUCH VEHICLE AND AN OFFER TO PROVIDE, THE PROVISION OF, OR A REPRESEN-
TATION THAT SUCH PERSON MAY PROVIDE A SERVICE OF ARRANGING, ASSISTING,
S. 4332 11
FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHI-
CLE.
G. NOTHING IN THIS SUBDIVISION SHALL BE CONSTRUED TO PROHIBIT A FRAN-
CHISOR, MANUFACTURER, OR DISTRIBUTOR FROM SPONSORING ACTIVITIES INTENDED
TO GENERATE LEADS TOWARD THE SALE OR LEASE OF A NEW MOTOR VEHICLE BY A
FRANCHISEE.
b-3. In the case of an application for registration as an automobile
broker business, EITHER FOR INITIAL REGISTRATION OR RENEWAL THEREOF, the
name and address of the surety company which will issue the bond
required by subdivision one of section seven hundred forty-a of the
general business law, A COPY OF SUCH BOND CERTIFIED BY THE SECRETARY OF
STATE OR ONE OF HIS OR HER AGENTS, AND A STATEMENT INDICATING ANY INTER-
EST IN THE APPLICANT'S BUSINESS ENTITY BY A PERSON OR ENTITY DESCRIBED
IN PARAGRAPH F OF SUBDIVISION ONE OR PARAGRAPH F OF SUBDIVISION SEVEN OF
THIS SECTION, OR ANY EMPLOYEE OR PERSON, CONTROLLING PERSON OR ENTITY
THEREOF. If the bond is to be issued by an authorized agent of the sure-
ty company licensed by the state, then the name and address of that
agent may be provided in lieu of the information concerning the surety
company.
§ 13. Section 415 of the vehicle and traffic law is amended by adding
two new subdivisions 21 and 22 to read as follows:
21. PENALTIES AND RIGHTS OF ACTION FOR FAILURE TO OBTAIN A CERTIFICATE
OF REGISTRATION AS AN AUTOMOBILE BROKER PURSUANT TO SUBDIVISION THREE-A
AND PARAGRAPH B-3 OF SUBDIVISION FIVE OF THIS SECTION. IN ADDITION TO
ANY OTHER ACTION AUTHORIZED BY LAW, THE COMMISSIONER, OR ANY PERSON
DESIGNATED BY HIM OR HER, MAY PROCEED AGAINST A PARTY WHO HAS OPERATED
AS AN AUTOMOBILE BROKER WITHOUT CERTIFICATE OF REGISTRATION IN ACCORD-
ANCE WITH THE PROVISIONS OF THIS ARTICLE, IN ANY ONE OR MORE PROCEEDINGS
AND BY ORDER TO ENJOIN SUCH UNLAWFUL ACTS OR PRACTICES AND REQUIRING THE
OFFENDING PARTY TO PAY THE PEOPLE OF THIS STATE A PENALTY IN A SUM NOT
LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND DOLLARS
FOR EACH VIOLATION FOUND TO HAVE BEEN COMMITTED. CIVIL PENALTIES
ASSESSED UNDER THIS SUBDIVISION SHALL BE PAID TO THE COMMISSIONER FOR
DEPOSIT INTO THE STATE TREASURY, AND UNPAID CIVIL PENALTIES MAY BE
RECOVERED BY THE COMMISSIONER IN A CIVIL ACTION IN THE NAME OF THE
COMMISSIONER. FOR THE PURPOSES OF THIS SUBDIVISION, A "VIOLATION" SHALL
MEAN EACH VEHICLE SOLD OR LEASED TO A CONSUMER FOR WHICH THE PARTY THAT
FAILED TO OBTAIN CERTIFICATION AS AN AUTOMOBILE BROKER HAS SERVED AS AN
AUTOMOBILE BROKER.
22. AUTOMOBILE BROKER RECORD REQUIREMENTS. A. AUTOMOBILE BROKERS SHALL
MAINTAIN A PERMANENTLY BOUND BOOK IN WHICH SHALL BE RECORDED THE MAKE,
MODEL, YEAR, COLOR AND VEHICLE IDENTIFICATION NUMBER OF ALL NEW MOTOR
VEHICLES FOR WHICH SUCH BROKER HAS PROVIDED A SERVICE OF PURCHASING,
ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF
SUCH AUTOMOBILE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL
ALSO RECORD IN SUCH BOOK THE NAME AND ADDRESS OF THE PURCHASER OR LESSOR
OF SUCH AUTOMOBILE, THE DATE OF SALE OR COMMENCEMENT OF LEASE OF SUCH
AUTOMOBILE AND THE NAME AND ADDRESS OF THE DEALER FROM WHICH THE AUTOMO-
BILE WAS PURCHASED OR LEASED.
B. AUTOMOBILE BROKER BUSINESSES SHALL MAINTAIN A PERMANENTLY BOUND
BOOK IN WHICH SHALL BE RECORDED ALL COMPLETED ORDERS TO SEARCH FOR A NEW
MOTOR VEHICLE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL
ALSO RECORD IN SUCH BOOK THE DATE OF SUCH ORDER, THE NAME AND ADDRESS OF
THE PERSON OR ENTITY ORDERING SUCH SEARCH, THE AUTOMOBILE SPECIFICATIONS
PROVIDED BY SUCH PROSPECTIVE BUYER OR LESSEE AND THE NAME AND ADDRESS OF
S. 4332 12
THE DEALERS SOLICITED FOR A QUOTE OR OFFER ON BEHALF OF SUCH PROSPECTIVE
BUYER OR LESSEE.
C. SUCH BOOKS SHALL BE OPEN FOR INSPECTION BY THE COMMISSIONER, OR HIS
OR HER AGENT, DURING REASONABLE BUSINESS HOURS. THE COMMISSIONER MAY
ESTABLISH BY RULE THE FORM OF ANY SUCH BOOK.
D. AS AN ALTERNATIVE TO A BOUND BOOK, AN AUTOMOBILE BROKER MAY USE A
COMPUTER AND SOFTWARE APPROVED BY THE DEPARTMENT TO MAINTAIN THE RECORDS
REQUIRED TO BE KEPT BY THIS SECTION, PROVIDED ALL INFORMATION REQUIRED
BY PARAGRAPHS A AND B OF THIS SECTION ARE RECORDED AND THE RECORDS
CONFORM TO SUCH ADDITIONAL REQUIREMENTS AS DETERMINED BY THE COMMISSION-
ER.
§ 14. Subdivision 5 of section 337 of the personal property law is
amended by adding a new paragraph (m) and such section is amended by
adding a new subdivision 4-a to read as follows:
4-A. ANY CREDIT APPLICATION, OR OTHER REQUEST FOR A DETERMINATION OF
CREDITWORTHINESS, IN FURTHERANCE OF A RETAIL LEASE AGREEMENT FOR A NEW
MOTOR VEHICLE, THAT IS SUBMITTED TO A LESSOR OR ANTICIPATED ASSIGNEE
THAT IS A MANUFACTURER, AS SUCH TERM IS DEFINED IN SECTION FOUR HUNDRED
FIFTEEN OF THE VEHICLE AND TRAFFIC LAW, A PERSON UNDER CONTRACT WITH A
MANUFACTURER TO SERVE AS HOLDER, OR A CAPTIVE FINANCE SOURCE, AS SUCH
TERM IS DEFINED BY SUBDIVISION SIXTEEN OF SECTION FOUR HUNDRED SIXTY-TWO
OF THE VEHICLE AND TRAFFIC LAW, SHALL INCLUDE THE NAME, ADDRESS, AND
DEPARTMENT OF MOTOR VEHICLES REGISTRATION NUMBER OF THE AUTOMOBILE
BROKER BUSINESS THAT PROVIDED THE SERVICE OF ARRANGING, ASSISTING,
FACILITATING OR EFFECTING SUCH AGREEMENT AS AGENT, BROKER, OR INTERME-
DIARY FOR SUCH RETAIL LESSEE, AND THE AMOUNT OF THE FEE PAID BY THE
CONSUMER TO THE AUTOMOBILE BROKER BUSINESS, AS SUCH TERM IS USED IN
ARTICLE THIRTY-FIVE-B OF THE GENERAL BUSINESS LAW, FOR THE SERVICE OF
ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE LEASE OF SUCH NEW
MOTOR VEHICLE.
(M) IN THE CASE OF A RETAIL LEASE AGREEMENT FOR A NEW MOTOR VEHICLE,
AS SUCH TERM IS DEFINED IN SUBDIVISION ELEVEN OF SECTION FOUR HUNDRED
SIXTY-TWO OF THE VEHICLE AND TRAFFIC LAW, WHERE THE LESSOR OR ANTIC-
IPATED ASSIGNEE IS A MANUFACTURER, AS SUCH TERM IS DEFINED IN SUBDIVI-
SION NINE OF SECTION FOUR HUNDRED SIXTY-TWO OF THE VEHICLE AND TRAFFIC
LAW, A PERSON UNDER CONTRACT WITH THE MANUFACTURER OF SUCH LEASED NEW
MOTOR VEHICLE TO SERVE AS HOLDER, OR A CAPTIVE FINANCE SOURCE, AS SUCH
TERM IS DEFINED BY SUBDIVISION SIXTEEN OF SECTION FOUR HUNDRED SIXTY-TWO
OF THE VEHICLE AND TRAFFIC LAW, THE NAME, ADDRESS, AND DEPARTMENT OF
MOTOR VEHICLES REGISTRATION NUMBER OF THE AUTOMOBILE BROKER BUSINESS
THAT PROVIDED THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR
EFFECTING SUCH AGREEMENT AS AGENT, BROKER, OR INTERMEDIARY FOR SUCH
RETAIL LESSEE, AND THE AMOUNT OF THE FEE PAID BY THE CONSUMER TO THE
AUTOMOBILE BROKER BUSINESS, AS SUCH TERM IS USED IN ARTICLE
THIRTY-FIVE-B OF THE GENERAL BUSINESS LAW, FOR THE SERVICE OF ARRANGING,
ASSISTING, FACILITATING OR EFFECTING THE LEASE OF SUCH NEW MOTOR VEHI-
CLE.
§ 15. Severability. If any provision of this act, or any application
of any provision of this act, is held to be invalid, that shall not
affect the validity or effectiveness of any other provision of this act,
or of any other application of any provision of this act, which can be
given effect without that provision or application; and to that end, the
provisions and applications of this act are severable.
§ 16. This act shall take effect immediately; provided that all auto-
mobile brokers registered on the effective date of this act shall have
ninety days to come into compliance with the provisions of this act.
co-Sponsors
(D) Senate District
(D) 14th Senate District
(D) Senate District
(D) 26th Senate District
(D) Senate District
(R, C) 2nd Senate District
(D, WF) 13th Senate District
(D) 32nd Senate District
(D) 42nd Senate District
(D) 11th Senate District
2021-S4332A - Details
- See Assembly Version of this Bill:
- A1932
- Current Committee:
- Senate Consumer Protection
- Law Section:
- General Business Law
- Laws Affected:
- Amd §§736, 736-a, 738, 740-a, 741, 741-b & 743, add §§737-a & 741-c, Gen Bus L; amd §415, V & T L
- Versions Introduced in Other Legislative Sessions:
-
2019-2020:
A6655
2023-2024: S5445, A3499
2025-2026: S4981
2021-S4332A - Sponsor Memo
BILL NUMBER: S4332A
SPONSOR: SAVINO
TITLE OF BILL:
An act to amend the general business law and the vehicle and traffic
law, in relation to designating new automotive broker businesses
PURPOSE OR GENERAL IDEA OF BILL:
To decrease the incidents of deceptive practices by automobile broker
businesses who seek to facilitate the sale or lease of motor vehicles.
SUMMARY OF PROVISIONS:
Section 1 amends subdivision 1 of section 736 of the General Business
Law to clarify which types of enterprises are not automobile broker
businesses.
Section 2 amends section 736-a of the General Business-Law to add condi-
tions to an automobile broker business registration and to empower the
Department of Motor Vehicles to issue regulations governing such activ- ity. Section 3 adds a new Section 737-a of the General Business Law to require brokers to solicit three bids from dealers on behalf of consum- ers seeking a new motor vehicle and to require DMV to issue regulations enforcing this requirement. Section 4 amends section 738 of the General Business Law to require brokers to have a signed contract before facilitating a sale or lease of a new motor vehicle and to allow consumers to cancel their brokering contract in certain situations, including if an automobile broker busi- ness fails to find a vehicle within thirty (30) days. Section 5 amends section 740-a of the General Business Law to raise the surety bond requirement for brokers. Section 6 amends section 741 of the General Business Law to prohibit brokers from engaging in various forms of deceptive advertising and business practices, including refusing to disclose its DMV or local government registration number or advertising in a way that confuses a consumer as to whether the business is a dealer and not a broker. Section 7 amends section 741-b of the General Business Law to require brokers to disclose fees and consumer rights to consumers, obtain a written acknowledgment from consumers about these rights, and to notify dealers as to the provisions of section 739 of the General Business Law, which provide that contracts that violate Article 35-B are void and unenforceable. Section 8 adds a new section 741-c of the General Business Law to enhance consumer data protections within the automobile brokering indus- try, specifically by requiring brokers to undertake certain physical measures to secure private consumer information and to hold brokers to other relevant General Business Law standards for securing such informa- tion. Section 9 amends section 743 of the General Business Law to increase penalties and authorize local enforcement and new local laws on broker- ing. Section 9 also allows private actions against brokers and awards attorney's fees to prevailing plaintiffs. Section 10 amends subdivision 1 of section 415 of the Vehicle and Traf- fic Law to clarify the definition of dealer activity to distinguish it from brokering activity. Section 11 amends subdivision 3 of section 415 of the Vehicle and Traf- fic Law to prohibit dealers from using affiliated companies to violate Art. 35-b of the General Business Law. Section 12 amends subdivision 3-a of section 415 of the Vehicle and Traffic Law to add several conditions and prohibitions that relate to an automobile broker business registration, including provisions that require a broker to make certain consumer disclosures. Section 12 also amends paragraph b-three of subdivision three to clarify the broker registration process, including restrictions on the category of business that, or person who may hold an interest in an automobile broker busi- ness. Section 13 amends section 415 of the Vehicle and Traffic Law by adding new two new subdivisions, numbers twenty-one, and twenty-two. Subdivi- sion twenty-one authorizes DMV to penalize automobile broker businesses that fail to register. Subdivision twenty-two requires brokers to keep records for at least six years and authorizes DMV to inspect those records. Section 14 provides that nothing in this act shall be construed to limit, or to enlarge, the protections that 47 U.S.C. § 230 confers on an interactive computer service for content provided by another information content provider, as such terms are defined in 47 U.S.C. § 230. Section 15 is the bill's severability clause. Section 16 establishes the bill's effective date. JUSTIFICATION: If you have ever bought or leased a car through an automobile broker in New York, you most likely have no idea how much money your broker made off the deal. There is also a very good chance the broker did very little work to find your car, raising the question as to what value a consumer derives from broker services. Brokers regularly deprive consumers of critical information on potential savings because the brokers obscure how much they get paid, which often occurs long after the consumer signs the dotted line. Nor do brokers make a serious attempt to get the best deal, as they typically work only with only one dealer, or an exclusive few, which are often based out-of- state. As a result, consumers get stuck with whatever deal a broker presents and that's been lined up well before a consumer even contacts a broker. Compounding the problem, many brokers advertise like new car dealers, obscuring that they are merely a middleman between the consumer and dealer and violating state laws in the process. Indeed, right now, hundreds and hundreds of automobile broker businesses continue to oper- ate while flouting basic laws requiring that they register with DMV and make certain consumer disclosures, including that the broker is not an automobile dealer. Many brokers also fail to make even the simplest of efforts to comply with automotive industry standards for consumer data protection. And no broker provides warranty and recall repair services or employs trained workers to educate consumers about vehicle safety features and other options in today's models. Unfortunately, the proliferation of broker businesses has also jeopard- ized the enormous investments of New York's 1,000 new car dealerships and the security of over 120,000 career-oriented dealership jobs state- wide. In exchange for the right to sell, lease, and service particular new motor vehicle brands, and according to franchise agreements, dealers must maintain high levels of customer satisfaction. Sadly, brokers only serve to skim profits and undercut New York based new car dealers and the entire Franchise System with it. They do this by avoiding capital and facility investments dealers must make, exploiting manufacturer incentive programs that only serve to drive dealerships out of business and reduce. competition, ignoring basic consumer protection laws, and concealing profits from consumers. Beyond the jobs they create, dealers also pay millions in real property taxes, and hundreds of millions in sales tax annually. Dealers also give consumers the knowledge and comfort of dealing with a reputable business supported by a large motor vehicle manufacturer. This legislation favorably addresses these problems to protect consumers and ensure fair market competition by maintaining a clear path for responsible brokering. Specifically, this bill will strengthen the broker registration process, increase disclosures, penalties, and enforcement provisions, and require brokers, for the first time, to work only for consumers, including by requiring brokers to solicit at least three bids on the behalf of a consumer. PRIOR LEGISLATIVE HISTORY: 2021 Session - new bill. (similar to S4364c of 2019/20) FISCAL IMPLICATIONS: None to the state. EFFECTIVE DATE: Immediate, except that all registered brokers shall have ninety (90) days to comply.
2021-S4332A - Bill Text download pdf
S T A T E O F N E W Y O R K
________________________________________________________________________
4332--A
2021-2022 Regular Sessions
I N S E N A T E
February 3, 2021
___________
Introduced by Sens. SAVINO, BENJAMIN, GOUNARDES, MATTERA -- read twice
and ordered printed, and when printed to be committed to the Committee
on Consumer Protection -- committee discharged, bill amended, ordered
reprinted as amended and recommitted to said committee
AN ACT to amend the general business law and the vehicle and traffic
law, in relation to designating new automotive broker businesses
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision 1 of section 736 of the general business law,
as amended by chapter 28 of the laws of 2018, is amended to read as
follows:
1. "Automobile broker business" means any person who, for a fee,
commission or other valuable consideration, regardless of whether such
fee, commission, or consideration is paid directly by a consumer, offers
to provide, provides, or represents that he or she will provide a
service of purchasing, arranging, assisting, facilitating or effecting
the purchase or lease of an automobile as agent, broker, or intermediary
for a consumer. "Automobile broker business" does not include any person
registered as a NEW MOTOR VEHICLE dealer OR QUALIFIED DEALER pursuant to
article sixteen of the vehicle and traffic law, ANY PERSON REGISTERED
UNDER SECTION FOUR HUNDRED FIFTEEN-A OF THE VEHICLE AND TRAFFIC LAW,
ONLY WHEN OPERATING UNDER ACTIVITY COVERED BY SUCH REGISTRATION, AN
AUTOMOBILE AUCTIONEER, ONLY WHEN OPERATING IN THE MANNER DESCRIBED IN
SECTION TWENTY-THREE OF THIS CHAPTER, nor any bona fide employee of a
registered NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer while acting for
such NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer, or any person who
sells, offers for sale or lease or acts as agent, broker or intermediary
in effecting the purchase or lease of three or fewer automobiles in any
calendar year, any national service which aggregates information for
consumers, but does not otherwise have contact with consumers, [or] any
motor vehicle franchisor, manufacturer, or distributor, DISTRIBUTOR
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07655-03-1 S. 4332--A 2 BRANCH OR FACTORY BRANCH registered under article sixteen of the vehicle and traffic law. § 2. Section 736-a of the general business law, as added by chapter 477 of the laws of 2017, is amended to read as follows: § 736-a. Registration required. 1. (A) No person shall engage in busi- ness as an automobile broker business, as defined in section seven hundred thirty-six of this article, without first having been issued a certificate of registration for an automobile broker business pursuant to paragraph c of subdivision seven of section four hundred fifteen of the vehicle and traffic law. A CERTIFICATE OF REGISTRATION FOR AN AUTO- MOBILE BROKER BUSINESS SHALL BE VALID FOR A PERIOD OF TWO YEARS. (B) NO AUTOMOBILE BROKER BUSINESS SHALL REPRESENT OR ACCEPT PAYMENT FROM, EITHER DIRECTLY OR INDIRECTLY, A FRANCHISEE, DEALER, FRANCHISOR, MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR FACTORY BRANCH, AS SUCH TERMS ARE DEFINED IN SECTIONS FOUR HUNDRED FIFTEEN AND FOUR HUNDRED SIXTY-TWO OF THE VEHICLE AND TRAFFIC LAW. (C) NO AUTOMOBILE BROKER BUSINESS SHALL PERFORM ANY SERVICES INVOLVING THE PURCHASING, ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF AN AUTOMOBILE AS AGENT, BROKER, OR INTERMEDIARY FOR A CONSUMER, UNLESS DONE PURSUANT TO A CONTRACT THAT COMPLIES WITH THE PROVISIONS OF SECTION SEVEN HUNDRED THIRTY-EIGHT OF THIS ARTICLE. 2. A certificate of registration for an automobile broker business shall not permit the registrant to display for sale or lease any new or used motor vehicles without registration as a dealer under section four hundred fifteen of the vehicle and traffic law. 3. ANY PERSON THAT SELLS OR LEASES FIVE OR MORE VEHICLES IN A CALENDAR YEAR TO OR THROUGH ONE OR MORE AUTOMOBILE BROKER BUSINESS SHALL BE DEEMED TO BE DEALING IN MOTOR VEHICLES AS THAT TERM IS USED IN PARAGRAPH A OF SUBDIVISION ONE OF SECTION FOUR HUNDRED FIFTEEN OF THE VEHICLE AND TRAFFIC LAW. 4. THE COMMISSIONER OF MOTOR VEHICLES SHALL ADOPT RULES AND REGU- LATIONS NECESSARY TO EFFECTUATE THE PROVISIONS OF THIS SECTION, INCLUD- ING REGULATIONS THAT REQUIRE THE DISCLOSURE OF THE NAME, ADDRESS, AND REGISTRATION NUMBER OF AN AUTOMOBILE BROKER BUSINESS THAT PROVIDED THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF ANY NEW MOTOR VEHICLE, AND THE FEE COLLECTED BY THE BROKER FROM THE CONSUMER FOR PROVIDING SUCH SERVICE. SUCH RULES AND REGULATIONS SHALL REQUIRE THAT SUCH INFORMATION OF THE AUTOMOBILE BROKER BUSINESS AND ITS FEE FOR SERVICE BE PRINTED ON ANY INVOICE, BILL OF SALE, OR BUYER'S ORDER, AND ON ANY APPLICATION FOR REGISTRATION OR TITLE SUBMIT- TED BY ANY DEALER TO THE DEPARTMENT OF MOTOR VEHICLES ON BEHALF OF THE CONSUMER RELATED TO SUCH PURCHASED OR LEASED MOTOR VEHICLE. § 3. The general business law is amended by adding a new section 737-a to read as follows: § 737-A. BONA FIDE BID SOLICITING REQUIRED. 1. ON BEHALF OF EACH CONSUMER EXECUTING A CONTRACT THAT CONFORMS TO THE REQUIREMENTS OF SUBDIVISION THREE OF SECTION SEVEN HUNDRED THIRTY-EIGHT OF THIS ARTICLE, AN AUTOMOBILE BROKER BUSINESS SHALL SOLICIT A BID, FROM AT LEAST NEW MOTOR VEHICLE DEALERS OF THE SAME LINE-MAKE, THAT MEETS THE SPECIFICA- TIONS OF SUCH PROSPECTIVE BUYER OR LESSEE, INCLUDING FROM THE NEW MOTOR VEHICLE DEALER LOCATED IN CLOSEST PROXIMITY TO THE HOME ADDRESS OF A PROSPECTIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE OR, IN THE CASE OF AN ENTITY, THE PLACE OF DOING BUSINESS OF SUCH PROSPECTIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE. WHENEVER AN AUTOMOBILE BROKER BUSINESS MAY CHOOSE BID SPECIFICATIONS ON BEHALF OF A CONSUMER, SUCH AUTOMOBILE BROKER BUSINESS SHALL SOLICIT A BID MATCHING SUCH SPECIFICATIONS FROM AT S. 4332--A 3 LEAST THREE NEW MOTOR VEHICLE DEALERS OF THE SAME LINE-MAKE, INCLUDING FROM THE NEW MOTOR VEHICLE DEALER LOCATED IN CLOSEST PROXIMITY TO THE HOME ADDRESS OF A PROSPECTIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE OR, IN THE CASE OF AN ENTITY, THE PLACE OF DOING BUSINESS OF SUCH PROSPEC- TIVE BUYER OR LESSEE OF A NEW MOTOR VEHICLE. 2. AT A MINIMUM, AN AUTOMOBILE BROKER BUSINESS THAT SOLICITS A BID PURSUANT TO SUBDIVISION ONE OF THIS SECTION SHALL REQUEST THE FOLLOWING INFORMATION AS PART OF ANY SOLICITATION TO A NEW MOTOR VEHICLE DEALER: (A) PRICE OR LEASE COSTS; (B) DOWN OR SIMILAR PAYMENT; (C) NUMBER OF PAYMENTS; (D) AMOUNT OF INSTALLMENT OR MONTHLY PAYMENTS; (E) MAKE, MODEL, YEAR OF PRODUCTION, AND COLOR OF ANY AVAILABLE MOTOR VEHICLE; (F) WHETHER THE MOTOR VEHICLE HAS ACCESSORIES SPECIFICALLY REQUESTED BY THE CONSUMER; (G) FEES; (H) WHERE APPLICABLE, FINANCE CHARGES AND/OR ANNUAL PERCENTAGE RATE; (I) ESTIMATED DELIVERY DATE OF THE AUTOMOBILE; (J) STATEMENT OF WHETHER OR NOT THE MANUFACTURER'S WARRANTY ACCOMPANY- ING THE MOTOR VEHICLE IS THE SAME WARRANTY AS THAT FURNISHED TO PURCHAS- ERS OF THE SAME MOTOR VEHICLE BY AN AUTHORIZED DEALER; AND (K) THE IDENTITY OF THE NEW MOTOR VEHICLE DEALER OFFERING A BID. 3. THE CONTENTS OF EACH BID BY A MOTOR VEHICLE DEALER, SOLICITED PURSUANT TO SUBDIVISION ONE OF THIS SECTION, SHALL BE PROVIDED TO EACH CONSUMER ON WHOSE BEHALF SUCH BID HAS BEEN SOLICITED, REGARDLESS OF THE PARTICULARS OR CONTENT OF ANY SUCH BID. 4. THE COMMISSIONER OF MOTOR VEHICLES SHALL ADOPT RULES AND REGU- LATIONS NECESSARY TO EFFECTUATE THE PROVISIONS OF THIS SECTION. § 4. The opening paragraph and paragraph (e) of subdivision 1 and subdivisions 3 and 4 of section 738 of the general business law, the opening paragraph and paragraph (e) of subdivision 1 as amended and subdivision 4 as added by chapter 28 of the laws of 2018 and subdivision 3 as amended by chapter 477 of the laws of 2017, are amended to read as follows: Every contract between a consumer and an automobile broker business for the purchase of [an automobile] A MOTOR VEHICLE, OTHER THAN A NEW MOTOR VEHICLE, shall be in writing, shall be dated, shall contain the street address of the automobile broker business and the consumer and shall be signed by the consumer and by the automobile broker business. Every contract shall comply with the requirements set forth in this section and contain the following: (e) A description of any other services and an itemization of the charges for each. Such description shall include disclosure of the auto- mobile dealer from which the automobile was purchased, as well as all fees, commissions or other valuable [considerations paid by an automo- bile dealer] CONSIDERATION OWED BY THE CONSUMER to the automobile broker business for selling, arranging, assisting or effecting the sale of an automobile as agent, broker, or intermediary between the consumer and the automobile dealer. 3. EVERY CONTRACT BETWEEN A CONSUMER AND AN AUTOMOBILE BROKER BUSINESS FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE SHALL BE IN WRITING, SHALL BE DATED, SHALL CONTAIN THE STREET ADDRESS OF THE AUTOMOBILE BROKER BUSI- NESS AND THE CONSUMER, AND SHALL BE SIGNED BY THE CONSUMER AND BY THE AUTOMOBILE BROKER BUSINESS. EVERY SUCH CONTRACT SHALL COMPLY WITH THE S. 4332--A 4 REQUIREMENTS SET FORTH IN THIS SECTION AND CONTAIN THE FOLLOWING PROVISIONS, WHICH SHALL BE PRINTED IN AT LEAST TWELVE-POINT BOLD TYPE AND SHALL NOT BE NEGATED OR SUPERSEDED BY ANY ADDITIONAL PROVISION: (A) A TITLE, ACROSS THE TOP OF THE DOCUMENT IN AT LEAST SIXTEEN-POINT BOLD TYPE, OF "CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE". (B) A STATEMENT OF WHETHER A SOLICITED NEW MOTOR VEHICLE IS OR WILL BE MANUFACTURED IN ACCORDANCE WITH UNITED STATES SPECIFICATIONS AND IS OR WILL BE CERTIFIED BY THE MANUFACTURER AS SUCH IF THE NEW MOTOR VEHICLE IS NOT OR WILL NOT BE MANUFACTURED IN ACCORDANCE WITH UNITED STATES SAFETY AND ENVIRONMENTAL SPECIFICATIONS, AND THE CONSUMER HAS RETAINED THE AUTOMOBILE BROKER BUSINESS TO ARRANGE FOR THE MODIFICATION OF THE NEW MOTOR VEHICLE TO MEET SUCH SPECIFICATIONS, THE NAME AND STREET ADDRESS OF THE MODIFICATION FACILITY AND A STATEMENT IN IMMEDIATE PROX- IMITY TO SUCH INFORMATION THAT THE AUTOMOBILE BROKER BUSINESS ASSUMES FULL FINANCIAL RESPONSIBILITY THAT THE NEW MOTOR VEHICLE WILL BE PROPER- LY MODIFIED TO MEET ALL UNITED STATES SAFETY AND ENVIRONMENTAL SPECIFI- CATIONS. (C) A STATEMENT THAT THE CONSUMER MAY CANCEL THE CONTRACT FOR AUTOMO- BILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE FOR ANY REASON WITHIN THREE DAYS OF THE EXECUTION OF SUCH CONTRACT AND THAT THE CONSUMER HAS THE RIGHT TO A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING RECEIPT OF THE NOTICE OF CANCELLATION. (D) A STATEMENT THAT, IF THE REQUESTED NEW MOTOR VEHICLE CANNOT BE PROCURED BY THE AUTOMOBILE BROKER BUSINESS WITHIN THIRTY DAYS FOLLOWING THE DATE OF EXECUTION OF THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE, THE CONSUMER HAS THE RIGHT TO CANCEL THE CONTRACT AND TO RECEIVE A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING RECEIPT OF THE REQUEST FOR A REFUND, UNLESS THE DELAY IN DELIVERY IS ATTRIBUTABLE TO THE CONSUMER. (E) A STATEMENT THAT THE CONSUMER SHALL BE PROVIDED WITH THE CONTENTS OF EACH BID RECEIVED BY THE AUTOMOBILE BROKER BUSINESS IN RESPONSE TO ITS SOLICITATION ON BEHALF OF SUCH CONSUMER. (F) THE AMOUNT OF THE FEE TO BE PAID BY THE CONSUMER TO THE AUTOMOBILE BROKER BUSINESS FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE. (G) A STATEMENT THAT THE SINGLE FEE AUTHORIZED BY SUCH CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE IS INCLUSIVE OF ALL CHARGES INCIDENT TO THE PURCHASING, ARRANGING, ASSISTING, FACILITAT- ING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHICLE BY THE AUTOMOBILE BROKER BUSINESS AS AGENT, BROKER, OR INTERMEDIARY AND THAT NO OTHER CHARGE OR EXPENSE WHATSOEVER SHALL BE TAKEN, RECEIVED, RESERVED OR CONTRACTED FOR BY THE AUTOMOBILE BROKER BUSINESS FOR SUCH SERVICES. 4. THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE SHALL BE ACCOMPANIED BY A COMPLETED FORM IN DUPLICATE, CAPTIONED "NOTICE OF CANCELLATION" WHICH SHALL BE ATTACHED TO THE CONTRACT AND EASILY DETACHABLE, AND WHICH SHALL CONTAIN IN AT LEAST TWELVE-POINT TYPE THE FOLLOWING: "NOTICE OF CANCELLATION YOU MAY CANCEL THIS CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN THREE DAYS FROM THE DATE THAT A COPY OF AN EXECUTED CONTRACT IS RECEIVED BY YOU. YOU MAY ALSO CANCEL THIS CONTRACT, WITHOUT PENALTY OR OBLIGATION, IF THE AUTOMOBILE BROKER BUSINESS DOES NOT PRODUCE A BID MEETING YOUR SPECIFI- CATIONS WITHIN THIRTY DAYS OF THE DATE OF EXECUTION OF THIS CONTRACT. S. 4332--A 5 TO CANCEL THIS CONTRACT, MAIL OR DELIVER A SIGNED AND DATED COPY OF THIS CANCELLATION NOTICE, OR ANY OTHER WRITTEN NOTICE, TO (NAME OF AUTO- MOBILE BROKER BUSINESS) AT (ADDRESS OF AUTOMOBILE BROKER BUSINESS) NOT LATER THAN MIDNIGHT OF THE THIRD DAY FOLLOWING YOUR RECEIPT OF A SIGNED CONTRACT. I HEREBY CANCEL THIS TRANSACTION. ________________________________ (SIGNATURE OF CONSUMER) _____________________ (DATE)" 5. An automobile broker business shall deliver to the consumer or mail to him or her at the address shown on [the] ANY contract REQUIRED BY THIS SECTION, an executed copy thereof. [4. An] 6. IN ADDITION TO THE BROKERING SERVICES AGREEMENT REQUIRED BY SUBDIVISION ONE OF THIS SECTION, AN automobile broker business in any transaction involving the lease of a vehicle shall provide the retail lessee with a retail lease agreement as provided for in section three hundred thirty-seven of the personal property law. [The automobile broker shall provide a written disclosure of the amount of any fee, commission or other consideration paid or expected to be paid by the lessor to the automobile broker business in connection with a trans- action involving the lease of a vehicle. Such disclosure shall be signed by the retail lessee. The automobile broker business shall provide the retail lessee with a signed copy of such disclosure together with the retail lease agreement referenced herein.] NOTHING IN THIS SECTION SHALL BE CONSTRUED TO PERMIT THE DELIVERY OF AN EXECUTED RETAIL LEASE AGREE- MENT TO A NEW MOTOR VEHICLE BY A PERSON OTHER THAN THE PROSPECTIVE LESSEE. § 5. Subdivision 1 of section 740-a of the general business law, as amended by chapter 477 of the laws of 2017, is amended to read as follows: 1. Automobile broker businesses shall obtain and continue in effect a surety bond in an amount of [one] TWO hundred FIFTY thousand dollars executed by a surety company authorized to transact business in the state by the department of financial services of the state or its successor. The bonds shall be approved as to form by the secretary of state and shall be conditioned on the automobile broker business' payment of all valid bank drafts, including checks, drawn for the purchase of motor vehicles and safekeeping of all customer deposits related to the sale of a motor vehicle between the time of receipt of such customer deposit and the transfer of good title to the vehicle to the customer. § 6. Section 741 of the general business law, as added by chapter 616 of the laws of 1988, is amended to read as follows: § 741. Deceptive acts AND FRAUDS prohibited. 1. It is hereby declared to be a deceptive trade practice and unlawful for an automobile broker business to misrepresent directly or indirectly in its advertising, promotional materials, sales presentation, or in any manner: [1.] (A) The nature of the services to be performed AND THAT A THIRD PARTY WILL BE PAYING FOR ANY SUCH SERVICES; [2.] (B) The time within which the services will be performed; [3.] (C) The cost of the services to be performed; [and 4.] (D) The ability of the automobile broker business to perform the services; AND (E) THAT THE AUTOMOBILE BROKER BUSINESS IS AFFILIATED WITH ANY NEW MOTOR VEHICLE MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR FACTORY BRANCH INCLUDING THE USE OF ANY TRADEMARKS OR COPYRIGHTED MATE- RIAL WITHOUT THE EXPRESS, WRITTEN CONSENT OF THE OWNER OF SUCH MATERIAL. S. 4332--A 6 2. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO REFUSE TO DISCLOSE ITS REGISTRATION NUMBER, ISSUED EITHER BY THE STATE OR A MUNICIPALITY, TO A MOTOR VEHICLE DEALER. FURTHERMORE, IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSI- NESS TO MAKE ANY MISREPRESENTATION TO A MOTOR VEHICLE DEALER OR NEW MOTOR VEHICLE DEALER REGARDING THE ELIGIBILITY OF ANY CONSUMER FOR ANY DISCOUNTS, REDUCTIONS OR ANY BENEFIT PROGRAMS REGARDING THE SALE OR LEASE OF A MOTOR VEHICLE. 3. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO ADVERTISE NEW MOTOR VEHICLES, THROUGH ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM, WITHOUT DISCLOSING THAT IT IS NOT A LICENSED MOTOR VEHICLE DEALER AND IS NOT AN AUTHORIZED SATELLITE LOCATION FOR ANY PARTICULAR LICENSED MOTOR VEHICLE DEALER. 4. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO ADVERTISE THROUGH ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM, THAT WOULD LEAD A REASON- ABLE CONSUMER TO CONCLUDE THAT THE AUTOMOBILE BROKER BUSINESS IS A LICENSED NEW MOTOR VEHICLE DEALER. 5. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO MAINTAIN ANY WEBSITE WITHOUT INCLUDING A TEXT BOX WITH THE FOLLOWING STATEMENT IN NO LESS THAN EIGHTEEN-POINT BOLDFACE TYPE ON THE SPLASH PAGE: "(BROKER NAME) IS NOT A LICENSED NEW MOTOR VEHICLE DEALER IN THE STATE OF NEW YORK, NOR IS IT AN AUTHORIZED AFFILIATE OF ANY LICENSED NEW MOTOR VEHICLE DEALER IN THE STATE OF NEW YORK". 6. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO INCLUDE ANY PRICING OR FINANCING OFFERS OR PROMOTIONS IN ANY ADVERTISEMENT, INCLUDING ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM. 7. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO GAIN ACCESS TO OR USE, OR REPRESENT OR ADVERTISE THAT IT MAY ACCESS OR USE, A PORTAL, COMPUTER, OR INTERNET ACCOUNT OWNED BY OR RESERVED FOR A NEW MOTOR VEHICLE DEALER TO ACCESS OR USE ONE OR MORE FINANCE SOURCES THAT PROVIDE AUTOMOTIVE-RELATED LOANS, OR PURCHASES RETAIL INSTALLMENT CONTRACTS OR LEASE CONTRACTS FOR MOTOR VEHICLES. § 7. Section 741-b of the general business law, as added by chapter 28 of the laws of 2018, is amended to read as follows: § 741-b. [Disclosure] DISCLOSURES REQUIRED BY BROKERS. 1. An automo- bile broker business shall GENERATE AND provide a disclosure at the time such automobile broker business takes an order to search for a leased OR PURCHASED vehicle meeting the prospective BUYER OR lessee's specifica- tions. Such disclosure shall provide the amount of any fees, commissions or other valuable consideration the automobile broker business expects to receive, if known, from [a dealer, lessor or] any [other] person or entity for any assistance the automobile broker business provides in effecting the PURCHASE OR lease transaction. If the amount of any such fees, commissions or other valuable consideration the automobile broker business expects to receive is unknown at the time of the required disclosure, the automobile broker business shall disclose[: (a)] whether it has a contract with any dealer, lessor or any other person or entity for the provision of assistance in effecting a PURCHASE OR lease trans- action[; and (b) whether the automobile broker business may be compen- sated by the dealer, lessor or any other person or entity for any S. 4332--A 7 assistance in effecting such lease transaction]. NOTHING IN THIS SUBDI- VISION SHALL BE CONSTRUED TO PERMIT THE PAYMENT OF ANY FEES, COMMISSIONS OR OTHER VALUABLE CONSIDERATION TO AN AUTOMOBILE BROKER BUSINESS BY ANY MOTOR VEHICLE DEALER. 2. AN AUTOMOBILE BROKER BUSINESS SHALL GENERATE AND PROVIDE AN ADDI- TIONAL DISCLOSURE TO THE CONSUMER AT THE TIME SUCH AUTOMOBILE BROKER BUSINESS TAKES AN ORDER TO SEARCH FOR A MOTOR VEHICLE MEETING THE PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS. SUCH ADDITIONAL DISCLOSURE SHALL STATE THE FOLLOWING: (A) THAT THE AUTOMOBILE BROKER BUSINESS SHALL MAKE A BONA FIDE ATTEMPT TO OBTAIN A BID, QUOTE OR OFFER FROM AT LEAST THREE UNAFFILIATED DEALERS ON BEHALF OF THE PROSPECTIVE BUYER OR LESSEE FOR A MOTOR VEHICLE MEETING THE PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS, INCLUDING FROM THE NEW MOTOR VEHICLE DEALER OF SUCH LINE-MAKE LOCATED CLOSEST TO THE HOME OR PLACE OF BUSINESS OF SUCH PROSPECTIVE BUYER FOR A CONSUMER THAT SEEKS A NEW MOTOR VEHICLE; (B) THAT THE AUTOMOBILE BROKER BUSINESS SHALL PROVIDE TO THE CONSUMER ALL CONTENTS OF EACH BID MADE BY A MOTOR VEHICLE DEALER IN RESPONSE TO THE SOLICITATION OF THE AUTOMOBILE BROKER BUSINESS; AND (C) THAT THE AUTOMOBILE BROKER BUSINESS HAS A DUTY TO ACT FOR THE BENEFIT OF THE PROSPECTIVE BUYER OR LESSEE. 3. EACH DISCLOSURE REQUIRED BY THIS SECTION TO BE MADE TO A CONSUMER SHALL BE ACKNOWLEDGED IN WRITING BY EACH CONSUMER. 4. AT THE TIME AN AUTOMOBILE BROKER BUSINESS SOLICITS A BID FROM A NEW MOTOR VEHICLE DEALER IN THE MANNER DESCRIBED IN SECTION SEVEN HUNDRED THIRTY-SEVEN-A OF THIS ARTICLE, SUCH BROKER SHALL PROVIDE A DISCLOSURE TO EACH SOLICITED DEALER AS TO THE PROVISIONS OF SECTION SEVEN HUNDRED THIRTY-NINE OF THIS ARTICLE. 5. PRIOR TO THE EXECUTION OF ANY PURCHASE CONTRACT OR LEASE FOR AN AUTOMOBILE, AN AUTOMOBILE BROKER BUSINESS SHALL PROVIDE EACH CONSUMER WITH ALL DISCLOSURES REQUIRED TO BE MADE BY A DEALER. § 8. The general business law is amended by adding a new section 741-c to read as follows: § 741-C. PRIVATE INFORMATION SECURITY. 1. AN AUTOMOBILE BROKER BUSI- NESS SHALL REPORT ANNUALLY TO THE DEPARTMENT OF MOTOR VEHICLES ITS COMPLIANCE WITH SECTIONS THREE HUNDRED NINETY-NINE-CC, THREE HUNDRED NINETY-NINE-DD, THREE HUNDRED NINETY-NINE-DDD, THREE HUNDRED NINETY- NINE-H, THREE HUNDRED NINETY-NINE-OO, THREE HUNDRED NINETY-NINE-P, THREE HUNDRED NINETY-NINE-PP, AND EIGHT HUNDRED NINETY-NINE-BB OF THIS CHAP- TER. FOR THE PURPOSES OF SUBDIVISION TWO OF SECTION EIGHT HUNDRED NINE- TY-NINE-BB OF THIS CHAPTER, AN AUTOMOBILE BROKER BUSINESS SHALL NOT BE CONSIDERED A SMALL BUSINESS AS THAT TERM IS DEFINED IN THAT SECTION AND SHALL INSTEAD BE SUBJECT TO REASONABLE SECURITY REQUIREMENTS THAT ARE EQUIVALENT TO THOSE APPLICABLE TO NEW MOTOR VEHICLE DEALERS. 2. IN ADDITION TO THE REQUIREMENTS OF SUBDIVISION ONE OF THIS SECTION, AN AUTOMOBILE BROKER BUSINESS SHALL: (A) KEEP AND MAINTAIN ALL CONSUMER RECORDS CONTAINING PRIVATE INFORMA- TION IN A SAFE PLACE THAT IS NOT ACCESSIBLE TO PERSONS NOT EMPLOYED BY THE AUTOMOBILE BROKER BUSINESS, INCLUDING BY KEEPING AND MAINTAINING A CLEAR AND PERMANENT PHYSICAL BARRIER FROM OTHER BUSINESSES THAT SHARE OR NEIGHBOR ITS PLACE OF BUSINESS; (B) HAVE A MAILBOX AT SUCH PLACE OF BUSINESS DEDICATED ONLY TO THE AUTOMOBILE BROKER BUSINESS; AND (C) HAVE A METHOD OF LOCKING SECURITY ITEMS, INCLUDING A LOCKING CABI- NET OR SAFE. S. 4332--A 8 3. NO TRANSACTION FOR THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE THAT WAS ARRANGED, ASSISTED, FACILITATED OR EFFECTED BY AN AUTOMOBILE BROKER BUSINESS SHALL BE VALID UNLESS THE CONSUMER PERSONALLY DELIVERS AN EXECUTED PURCHASE CONTRACT OR LEASE, AND, WHERE APPLICABLE, FINANCING AGREEMENT, TO THE PLACE OF BUSINESS OF THE DEALER FROM WHICH SUCH VEHI- CLE WILL BE PURCHASED OR LEASED AND SUCH DEALER VERIFIES THE IDENTITY OF SUCH CONSUMER. § 9. Section 743 of the general business law, as amended by chapter 372 of the laws of 2016, is amended to read as follows: § 743. Enforcement [by]. 1. BY attorney general. In addition to the other remedies provided, whenever there shall be a violation of this article, application may be made by the attorney general in the name of the people of the state of New York to a court or justice having juris- diction by a special proceeding to issue an injunction, and upon notice to the defendant of not less than five days, to enjoin and restrain the continuance of such violations; and if it shall appear to the satisfac- tion of the court or justice that the defendant has, in fact, violated this article, an injunction may be issued by such court or justice, enjoining and restraining any further violation, without requiring proof that any person has, in fact, been injured or damaged thereby. In any such proceeding, the court may make allowances to the attorney general as provided in paragraph six of subdivision (a) of section eighty-three hundred three of the civil practice law and rules, and direct restitu- tion. Whenever the court shall determine that a violation of this arti- cle has occurred, the court shall impose a civil penalty of not less than [one] FOUR thousand dollars and not more than [three] TEN thousand dollars for each violation. In connection with any such proposed appli- cation, the attorney general is authorized to take proof and make a determination of the relevant facts and to issue subpoenas in accordance with the civil practice law and rules. 2. BY LOCAL AUTHORITIES. (A) MUNICIPALITIES MAY, PURSUANT TO LOCAL LAW, ACT UPON THE BUSINESS ACTIVITY THAT IS THE SUBJECT OF THIS ARTICLE, PROVIDED THAT NO LOCAL GOVERNMENT MAY DIMINISH THE PROTECTIONS OR REQUIREMENTS OF THIS ARTICLE OR PREVENT ENFORCEMENT OF ITS PROVISIONS BY APPROPRIATE STATE OFFICIALS. (B) THE PROVISIONS OF THIS ARTICLE MAY BE ENFORCED IN THE SAME MANNER AS SET FORTH IN SUBDIVISION ONE OF THIS SECTION BY THE DIRECTOR OF A MUNICIPAL CONSUMER AFFAIRS OFFICE OR A BUSINESS INTEGRITY COMMISSION, OR BY THE TOWN ATTORNEY, CITY CORPORATION COUNSEL, OR OTHER LAWFULLY DESIG- NATED ENFORCEMENT OFFICER OF A MUNICIPALITY OR LOCAL GOVERNMENT, AND ALL MONIES COLLECTED THEREUNDER SHALL BE RETAINED BY SUCH MUNICIPALITY OR LOCAL GOVERNMENT, PROVIDED THAT NO LOCAL GOVERNMENT MAY PREVENT ENFORCE- MENT OF ITS PROVISIONS BY APPROPRIATE STATE OFFICIALS. 3. BY PRIVATE PARTY. ANY PERSONS THAT ARE OR MAY BE INJURED BY ANY VIOLATION OF THIS ARTICLE MAY BRING AN ACTION IN HIS OR HER OWN NAME AGAINST AN AUTOMOBILE BROKER BUSINESS TO ENJOIN SUCH UNLAWFUL ACT OR PRACTICE, AN ACTION TO RECOVER HIS OR HER DAMAGES AND STATUTORY DAMAGES OF NOT LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION, OR BOTH SUCH ACTIONS. INJURY SHALL INCLUDE, BUT NOT BE LIMITED TO, LOST SALES ON ACCOUNT OF DECEPTIVE OR UNFAIR ADVERTISING AND DEPRIVING A NEW MOTOR VEHICLE DEALER LOCATED CLOSEST TO A LESSEE OR PURCHASER THE OPPORTUNITY TO BID ON SUCH LEASE OR PURCHASE AS ENTITLED BY THIS ARTICLE. DAMAGES SHALL INCLUDE, BUT NOT BE LIMITED TO, LOST SALES AND THE VALUE OF INCENTIVE PAYMENTS, BONUSES, HOLDBACKS OR SIMILAR PAYMENTS THAT WOULD HAVE BEEN REALIZED HAD A LESSEE OR PURCHASER PURCHASED OR LEASED SUCH VEHICLE FROM THE NEW MOTOR VEHICLE S. 4332--A 9 DEALER IN CLOSEST PROXIMITY TO SUCH LESSEE OR PURCHASER BUT FOR THE ACTIONS OF A PERSON WHO KNOWINGLY AIDED THE VIOLATION OF THE PROVISIONS OF THIS ARTICLE. NOTHING IN THIS SECTION SHALL REQUIRE A FRANCHISOR, MANUFACTURER, OR DISTRIBUTOR TO GRANT A NEW MOTOR VEHICLE DEALER A BENE- FIT UNDER AN INCENTIVE, BONUS, HOLDBACK OR SIMILAR PAYMENT THAT THE NEW MOTOR VEHICLE DEALER DID NOT EARN OR FOR WHICH THE NEW MOTOR VEHICLE DEALER DID NOT QUALIFY. SUCH ACTIONS MAY BE BROUGHT REGARDLESS OF WHETH- ER OR NOT THE UNDERLYING VIOLATION IS CONSUMER-ORIENTED OR HAS A PUBLIC IMPACT. GIVEN THE REMEDIAL NATURE OF THIS SUBDIVISION, STANDING TO BRING AN ACTION UNDER THIS SUBDIVISION SHALL BE LIBERALLY CONSTRUED AND SHALL BE AVAILABLE TO THE FULLEST EXTENT OTHERWISE PERMITTED BY LAW. THE COURT MAY, IN ITS DISCRETION, AWARD TREBLE DAMAGES IF THE COURT FINDS THE DEFENDANT WILLFULLY OR KNOWINGLY VIOLATED THIS ARTICLE. THE COURT SHALL AWARD REASONABLE ATTORNEY'S FEES AND COSTS TO A PREVAILING PLAINTIFF. § 10. Paragraph a of subdivision 1 of section 415 of the vehicle and traffic law, as amended by chapter 554 of the laws of 2015, is amended to read as follows: a. "Dealer" means a person engaged in the business of buying, selling or dealing in motor vehicles, motorcycles or trailers, other than mobile homes or manufactured homes, at retail or wholesale; except, however, trailers with an unladen weight of less than one thousand pounds. For the purposes of this section, a "mobile home" or "manufactured home" means a mobile home or manufactured home as defined in section one hundred twenty-two-c of this chapter. Any person who sells, or offers for sale OR LEASE more than five motor vehicles, motorcycles or trailers in any calendar year or who displays or permits the display of three or more motor vehicles, motorcycles or trailers for sale at any one time or within any one calendar month upon premises owned or controlled by him or her, if such vehicles were purchased, acquired or otherwise obtained by such person for the purpose of resale, will be regarded as a dealer. FOR THE PURPOSES OF THIS SECTION, "OFFERS FOR SALE OR LEASE" SHALL INCLUDE, BUT NOT BE LIMITED TO, THE ACT OF DRAWING THE PUBLIC'S ATTEN- TION TO, OR THE PRESENTATION OR DISPLAY OF ANY MOTOR VEHICLE, INCLUDING THE POSTING OF IMAGES OF ANY SUCH VEHICLE, TOGETHER WITH A SUGGESTED RETAIL PRICE, LEASE COST OR FINANCING RATE FOR SUCH VEHICLE AND AN OFFER TO PROVIDE, THE PROVISION OF, OR A REPRESENTATION THAT SUCH PERSON MAY PROVIDE A SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE LEASE OF SUCH NEW MOTOR VEHICLE, EXCEPT THIS MEANING SHALL NOT APPLY TO ANY ACTIVITY OF A COOPERATIVE OR OTHER ADVERTISING PROGRAM OR FUND AS DESCRIBED IN ANY FRANCHISE, AS SUCH TERM IS DEFINED BY SUBDIVISION SIX OF SECTION FOUR HUNDRED SIXTY-TWO OF THIS TITLE, OR THE DISPLAY OF AGGREGATED INFORMATION AND IMAGES BY A NATIONAL SERVICE THAT OTHERWISE DOES NOT HAVE CONTACT WITH CONSUMERS. Except as otherwise provided in subdivisions three, five, six-b, and seven of this section, the term "dealer" shall include a "new motor vehicle dealer" as defined by para- graph f of this subdivision and a "qualified dealer" as defined in para- graph g of this subdivision. § 11. Subdivision 3 of section 415 of the vehicle and traffic law is amended by adding a new paragraph d to read as follows: D. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR A DEALER TO USE ANY SUBSIDIARY CORPORATION, AFFILIATED CORPORATION, OR ANY OTHER CONTROLLED CORPORATION, PARTNERSHIP, ASSOCIATION, BUSINESS OR PERSON TO ACCOMPLISH WHAT WOULD OTHERWISE BE UNLAWFUL CONDUCT UNDER THIS ARTICLE OR ARTICLE THIRTY-FIVE-B OF THE GENERAL BUSINESS LAW, INCLUDING REQUEST- ING THAT AN AUTOMOBILE BROKER BUSINESS REPRESENT SUCH DEALER IN GENERAT- S. 4332--A 10 ING A SALE OR LEASE OR MAKING PAYMENT TO, EITHER DIRECTLY OR INDIRECTLY, AN AUTOMOBILE BROKER BUSINESS. § 12. Subdivision 3-a and paragraph b-3 of subdivision 5 of section 415 of the vehicle and traffic law, as added by chapter 477 of the laws of 2017, are amended to read as follows: 3-a. Automobile broker business registration. A. No person shall engage in the automobile broker business or represent or advertise that he or she is engaged or intends to engage in the automobile broker busi- ness in this state, unless there shall have been issued to him or her a certificate of registration as an automobile broker business by the commissioner under this section pursuant to an application for registra- tion submitted pursuant to subdivision five of this section. SUCH REGIS- TRATION SHALL BE EFFECTIVE FOR A PERIOD NOT EXCEEDING TWO YEARS. AT THE DISCRETION OF THE COMMISSIONER A REGISTRATION MAY BE RENEWED FOR A PERI- OD OF UP TO TWO YEARS UPON APPLICATION THEREFOR, IN SUCH FORM AS THE COMMISSIONER MAY PRESCRIBE, AND A SHOWING OF PROOF OF SATISFACTION OF THE REQUIREMENTS OF SECTION SEVEN HUNDRED FORTY-A OF THE GENERAL BUSI- NESS LAW, AND UPON PAYMENT OF THE FEE AS HEREIN PRESCRIBED. B. THE COMMISSIONER SHALL NOT ISSUE OR RENEW A CERTIFICATE OF REGIS- TRATION AUTHORIZED BY THIS SUBDIVISION TO ANY DEALER, FRANCHISEE, FRAN- CHISOR, MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH OR FACTORY BRANCH, AS SUCH TERMS ARE DEFINED IN SECTION FOUR HUNDRED SIXTY-TWO OF THIS TITLE, OR TO ANY SUBSIDIARY, AFFILIATE, EMPLOYEE OR CONTROLLED PERSON OR ENTITY THEREOF. C. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED PURSUANT TO THIS SUBDIVISION, AN AUTOMOBILE BROKER BUSINESS SHALL HAVE, AND CONTINUOUSLY MAINTAIN, A PLACE OF BUSINESS IN THIS STATE FOR WHICH IT SHALL KEEP AND MAINTAIN EVIDENCE THAT ALL NECESSARY APPROVALS, LICENSES AND/OR PERMITS HAVE BEEN OBTAINED FROM ALL LOCAL GOVERNING BODIES TO OPERATE SUCH PLACE OF BUSINESS WITH CUSTOMER OR CLIENT TRAF- FIC. NO MORE THAN ONE AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT ANY SINGLE LOCATION AND NO AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT THE SAME LOCATION AS A NEW MOTOR VEHICLE DEALER. D. EVERY REGISTERED AUTOMOBILE BROKER BUSINESS SHALL PROMINENTLY AND CONSPICUOUSLY POST, IN SUCH A MANNER THAT IT IS LIKELY TO BE NOTICEABLE TO ANYONE ENTERING ITS PREMISES, ITS OFFICIAL BUSINESS CERTIFICATE OF REGISTRATION AND A SIGN, WHICH SIGN SHALL CLEARLY STATE: "(NAME OF REGISTERED AUTOMOBILE BROKER) IS NOT A FRANCHISED NEW MOTOR VEHICLE DEALER. WE ARE NOT AUTHORIZED OR APPROVED BY A MANUFACTURER OR DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM RECALL OR ORIGINAL FACTORY WARRANTY WORK. IF YOU ORDER A SEARCH FOR A NEW MOTOR VEHICLE FROM THIS BROKER, WE MUST MAKE A BONA FIDE EFFORT TO SOLICIT BIDS FROM AT LEAST THREE UNAFFILIATED NEW MOTOR VEHICLE DEALERS FOR A NEW MOTOR VEHICLE ON YOUR BEHALF, INCLUDING FROM YOUR LOCAL DEALER." E. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED PURSUANT TO THIS SUBDIVISION, AND BEFORE PERFORMING ANY BROKER SERVICES RELATED TO A NEW MOTOR VEHICLE, AN AUTOMOBILE BROKER BUSINESS SHALL ATTEST IN WRITING TO EACH CONSUMER, THAT THE BROKER: (I) IS NOT A FRAN- CHISED NEW MOTOR VEHICLE DEALER; (II) IS NOT AUTHORIZED OR APPROVED BY A MANUFACTURER OR DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM RECALL OR ORIGINAL FACTORY WARRANTY WORK; AND (III) THAT THE BROKER SHALL MAKE A BONA FIDE EFFORT TO SOLICIT BIDS FROM AT LEAST THREE UNAF- FILIATED NEW MOTOR VEHICLE DEALERS THAT SELL A NEW MOTOR VEHICLE OR ANY LINE OR MAKE DESIRED BY SUCH CONSUMER, INCLUDING FROM THE CONSUMER'S LOCAL DEALER. S. 4332--A 11 F. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR AN AUTOMOBILE BROKER BUSINESS TO DRAW THE PUBLIC'S ATTENTION TO, OR PRESENT OR DISPLAY ANY NEW MOTOR VEHICLE, INCLUDING BY POSTING IMAGES OF ANY SUCH VEHICLE, TOGETHER WITH A SUGGESTED RETAIL PRICE, LEASE COST OR FINANCING RATE FOR SUCH VEHICLE AND AN OFFER TO PROVIDE, THE PROVISION OF, OR A REPRESEN- TATION THAT SUCH PERSON MAY PROVIDE A SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHI- CLE. G. NOTHING IN THIS SUBDIVISION SHALL BE CONSTRUED TO PROHIBIT A FRAN- CHISOR, MANUFACTURER, OR DISTRIBUTOR FROM SPONSORING ACTIVITIES INTENDED TO GENERATE LEADS TOWARD THE SALE OR LEASE OF A NEW MOTOR VEHICLE BY A FRANCHISEE. b-3. In the case of an application for registration as an automobile broker business, EITHER FOR INITIAL REGISTRATION OR RENEWAL THEREOF, the name and address of the surety company which will issue the bond required by subdivision one of section seven hundred forty-a of the general business law, A COPY OF SUCH BOND CERTIFIED BY THE SECRETARY OF STATE OR ONE OF HIS OR HER AGENTS, AND A STATEMENT INDICATING ANY INTER- EST IN THE APPLICANT'S BUSINESS ENTITY BY A PERSON OR ENTITY DESCRIBED IN PARAGRAPH F OF SUBDIVISION ONE OR PARAGRAPH F OF SUBDIVISION SEVEN OF THIS SECTION, OR ANY EMPLOYEE OR PERSON, CONTROLLING PERSON OR ENTITY THEREOF. If the bond is to be issued by an authorized agent of the sure- ty company licensed by the state, then the name and address of that agent may be provided in lieu of the information concerning the surety company. § 13. Section 415 of the vehicle and traffic law is amended by adding two new subdivisions 21 and 22 to read as follows: 21. PENALTIES AND RIGHTS OF ACTION FOR FAILURE TO OBTAIN A CERTIFICATE OF REGISTRATION AS AN AUTOMOBILE BROKER PURSUANT TO SUBDIVISION THREE-A AND PARAGRAPH B-3 OF SUBDIVISION FIVE OF THIS SECTION. IN ADDITION TO ANY OTHER ACTION AUTHORIZED BY LAW, THE COMMISSIONER, OR ANY PERSON DESIGNATED BY HIM OR HER, MAY PROCEED AGAINST A PARTY WHO HAS OPERATED AS AN AUTOMOBILE BROKER WITHOUT CERTIFICATE OF REGISTRATION IN ACCORD- ANCE WITH THE PROVISIONS OF THIS ARTICLE, IN ANY ONE OR MORE PROCEEDINGS AND BY ORDER TO ENJOIN SUCH UNLAWFUL ACTS OR PRACTICES AND REQUIRING THE OFFENDING PARTY TO PAY THE PEOPLE OF THIS STATE A PENALTY IN A SUM NOT LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION FOUND TO HAVE BEEN COMMITTED. CIVIL PENALTIES ASSESSED UNDER THIS SUBDIVISION SHALL BE PAID TO THE COMMISSIONER FOR DEPOSIT INTO THE STATE TREASURY, AND UNPAID CIVIL PENALTIES MAY BE RECOVERED BY THE COMMISSIONER IN A CIVIL ACTION IN THE NAME OF THE COMMISSIONER. FOR THE PURPOSES OF THIS SUBDIVISION, A "VIOLATION" SHALL MEAN EACH VEHICLE SOLD OR LEASED TO A CONSUMER FOR WHICH THE PARTY THAT FAILED TO OBTAIN CERTIFICATION AS AN AUTOMOBILE BROKER HAS SERVED AS AN AUTOMOBILE BROKER. 22. AUTOMOBILE BROKER RECORD REQUIREMENTS. A. AUTOMOBILE BROKERS SHALL MAINTAIN A PERMANENTLY BOUND BOOK IN WHICH SHALL BE RECORDED THE MAKE, MODEL, YEAR, COLOR AND VEHICLE IDENTIFICATION NUMBER OF ALL NEW MOTOR VEHICLES FOR WHICH SUCH BROKER HAS PROVIDED A SERVICE OF PURCHASING, ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH AUTOMOBILE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL ALSO RECORD IN SUCH BOOK THE NAME AND ADDRESS OF THE PURCHASER OR LESSOR OF SUCH AUTOMOBILE, THE DATE OF SALE OR COMMENCEMENT OF LEASE OF SUCH AUTOMOBILE AND THE NAME AND ADDRESS OF THE DEALER FROM WHICH THE AUTOMO- BILE WAS PURCHASED OR LEASED. S. 4332--A 12 B. AUTOMOBILE BROKER BUSINESSES SHALL MAINTAIN A PERMANENTLY BOUND BOOK IN WHICH SHALL BE RECORDED ALL COMPLETED ORDERS TO SEARCH FOR A NEW MOTOR VEHICLE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL ALSO RECORD IN SUCH BOOK THE DATE OF SUCH ORDER, THE NAME AND ADDRESS OF THE PERSON OR ENTITY ORDERING SUCH SEARCH, THE AUTOMOBILE SPECIFICATIONS PROVIDED BY SUCH PROSPECTIVE BUYER OR LESSEE AND THE NAME AND ADDRESS OF THE DEALERS SOLICITED FOR A QUOTE OR OFFER ON BEHALF OF SUCH PROSPECTIVE BUYER OR LESSEE. C. SUCH BOOKS SHALL BE OPEN FOR INSPECTION BY THE COMMISSIONER, OR HIS OR HER AGENT, DURING REASONABLE BUSINESS HOURS. THE COMMISSIONER MAY ESTABLISH BY RULE THE FORM OF ANY SUCH BOOK. D. AS AN ALTERNATIVE TO A BOUND BOOK, AN AUTOMOBILE BROKER MAY USE A COMPUTER AND SOFTWARE APPROVED BY THE DEPARTMENT TO MAINTAIN THE RECORDS REQUIRED TO BE KEPT BY THIS SECTION, PROVIDED ALL INFORMATION REQUIRED BY PARAGRAPHS A AND B OF THIS SECTION ARE RECORDED AND THE RECORDS CONFORM TO SUCH ADDITIONAL REQUIREMENTS AS DETERMINED BY THE COMMISSION- ER. § 14. Nothing in this act shall be construed to limit, or to enlarge, the protections that 47 U.S.C. § 230 confers on an interactive computer service for content provided by another information content provider, as such terms are defined in 47 U.S.C. § 230. § 15. Severability. If any provision of this act, or any application of any provision of this act, is held to be invalid, that shall not affect the validity or effectiveness of any other provision of this act, or of any other application of any provision of this act, which can be given effect without that provision or application; and to that end, the provisions and applications of this act are severable. § 16. This act shall take effect immediately; provided that all auto- mobile brokers registered on the effective date of this act shall have ninety days to come into compliance with the provisions of this act.
co-Sponsors
(D) Senate District
(D, WF) 55th Senate District
(D) 14th Senate District
(D) Senate District
(D) 26th Senate District
(D) Senate District
(R, C) 2nd Senate District
(D, WF) 13th Senate District
(D) 32nd Senate District
(D) 42nd Senate District
(D) 11th Senate District
2021-S4332B (ACTIVE) - Details
- See Assembly Version of this Bill:
- A1932
- Current Committee:
- Senate Consumer Protection
- Law Section:
- General Business Law
- Laws Affected:
- Amd §§736, 736-a, 738, 740-a, 741, 741-b & 743, add §§737-a & 741-c, Gen Bus L; amd §415, V & T L
- Versions Introduced in Other Legislative Sessions:
-
2019-2020:
A6655
2023-2024: S5445, A3499
2025-2026: S4981
2021-S4332B (ACTIVE) - Sponsor Memo
BILL NUMBER: S4332B
SPONSOR: SAVINO
TITLE OF BILL:
An act to amend the general business law and the vehicle and traffic
law, in relation to designating new automotive broker businesses
PURPOSE OR GENERAL IDEA OF BILL:
To decrease the incidents of deceptive practices by automobile broker
businesses who seek to facilitate the sale or lease of motor vehicles.
SUMMARY OF PROVISIONS:
Amendment to B-print - eliminate the need to obtain 3 bids, the require-
ment that a bid be from a local dealer by deleting old section 3 renum-
bering the bill and deleting other references to the 3-bid requirement
Section 1 amends subdivision 1 of section 736 of the General Business
Law to clarify which types of enterprises are not automobile broker
businesses.
Section 2 amends section 736-a of the General Business-Law to add condi- tions to an automobile broker business registration and to empower the Department of Motor Vehicles to issue regulations governing such activ- ity. Section 3 amends section 738 of the General Business Law to require brokers to have a signed contract before facilitating a sale or lease of a new motor vehicle and to allow consumers to cancel their brokering contract in certain situations, including if an automobile broker busi- ness fails to find a vehicle within thirty (30) days. Section 4 amends section 740-a of the General Business Law to raise the surety bond requirement for brokers from $100,000 to $250,000. Section 5 amends section 741 of the General Business Law to prohibit brokers from engaging in various forms of deceptive advertising and business practices, including refusing to disclose its DMV or local government registration number or advertising in a way that confuses a consumer as to whether the business is a dealer and not a broker. Section 6 amends section 741-b of the General Business Law to require brokers to disclose fees and consumer rights to consumers, obtain a written acknowledgment from consumers about these rights, and to notify dealers as to the provisions of section 739 of the General Business Law, which provide that contracts that violate Article 35-B are void and unenforceable. Section 7 adds a new section 741-c of the General Business Law to enhance consumer data protections within the automobile brokering indus- try, specifically by requiring brokers to undertake certain physical measures to secure private consumer information and to hold brokers to other relevant General Business Law standards for securing such informa- tion. Section 8 amends section 743 of the General Business Law to increase penalties and authorize local enforcement and new local laws on broker- ing. Section 8 also allows private actions against brokers and awards attorney's fees to prevailing plaintiffs. Section 9 amends subdivision 1 of section 415 of the Vehicle and Traffic Law to clarify the definition of dealer activity to distinguish it from brokering activity. Section 10 amends subdivision 3 of section 415 of the Vehicle and Traf- fic Law to prohibit dealers from using affiliated companies to violate Art. 35-b of the General Business Law. Section 11 also amends paragraph b-three of subdivision three to clarify the broker registration process and renewal process, including restrictions on the category of business that, or person who may hold an interest in an automobile broker business. Section 12 amends section 415 of the Vehicle and Traffic Law by adding new two new subdivisions, numbers twenty-one, and twenty-two. Subdivi- sion twenty-one authorizes DMV to penalize automobile broker businesses that fail to register. Subdivision twenty-two requires brokers to keep records for at least six years and authorizes DMV to inspect those records. Section 13 provides that nothing in this act shall be construed to limit, or to enlarge, the protections that 47 U.S.C. § 230 confers on an interactive computer service for content provided by another information content provider, as such terms are defined in 47 U.S.C. § 230. Section 14 is the bill's severability clause. Section 1 establishes the bill's effective date of immediately and the need to come into compliance within 90 days. JUSTIFICATION: If you have ever bought or leased a car through an automobile broker in New York, you most likely have no idea how much money your broker made off the deal. There is also a very good chance the broker did very little work to find your car, raising the question as to what value a consumer derives from broker services. Brokers regularly deprive consumers of critical information on potential savings because the brokers obscure how much they get paid, which often occurs long after the consumer signs the dotted line. Nor do brokers make a serious attempt to get the best deal, as they typically work only with only one dealer, or an exclusive few, which are often based out-of- state. As a result, consumers get stuck with whatever deal a broker presents and that's been lined up well before a consumer even contacts a broker. Compounding the problem, many brokers advertise like new car dealers, obscuring that they are merely a middleman between the consumer and dealer and violating state laws in the process. Indeed, right now, hundreds and hundreds of automobile broker businesses continue to oper- ate while flouting basic laws requiring that they register with DMV and make certain consumer disclosures, including that the broker is not an automobile dealer. Many brokers also fail to make even the simplest of efforts to comply with automotive industry standards for consumer data protection. And no broker provides warranty and recall repair services or employs trained workers to educate consumers about vehicle safety features and other options in today's models. Unfortunately, the proliferation of broker businesses has also jeopard- ized the enormous investments of New York's 1,000 new car dealerships and the security of over 120,000 career-oriented dealership jobs state- wide. In exchange for the right to sell, lease, and service particular new motor vehicle brands, and according to franchise agreements, dealers must maintain high levels of customer satisfaction. Sadly, brokers only serve to skim profits and undercut New Yorkbased new car dealers and the entire Franchise System with it. They do this by avoiding capital and facility investments dealers must make, exploiting manufacturer incentive programs that only serve to drive dealerships out of business and reduce. competition, ignoring basic consumer protection laws, and concealing profits from consumers. Beyond the jobs they create, dealers also pay millions in real property taxes, and hundreds of millions in sales tax annually. Dealers also give consumers the knowledge and comfort of dealing with a reputable business supported by a large motor vehicle manufacturer. This legislation favorably addresses these problems to protect consumers and ensure fair market competition by maintaining a clear path for responsible brokering. Specifically, this bill will strengthen the broker registration process, increase disclosures, penalties, and enforcement provisions, and require brokers, for the first time, to work only for consumers, including by requiring brokers to solicit at least three bids on the behalf of a consumer. PRIOR LEGISLATIVE HISTORY: 2021 Session - new bill. (similar to S4364c of 2019/20) FISCAL IMPLICATIONS: None to the state. EFFECTIVE DATE: Immediate, except that all registered brokers shall have ninety (90) days to comply.
2021-S4332B (ACTIVE) - Bill Text download pdf
S T A T E O F N E W Y O R K
________________________________________________________________________
4332--B
2021-2022 Regular Sessions
I N S E N A T E
February 3, 2021
___________
Introduced by Sens. SAVINO, COMRIE, GAUGHRAN, GOUNARDES, MANNION, MATT-
ERA, RAMOS, SEPULVEDA, SKOUFIS, STAVISKY -- read twice and ordered
printed, and when printed to be committed to the Committee on Consumer
Protection -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee -- recommitted to the
Committee on Consumer Protection in accordance with Senate Rule 6,
sec. 8 -- committee discharged, bill amended, ordered reprinted as
amended and recommitted to said committee
AN ACT to amend the general business law and the vehicle and traffic
law, in relation to designating new automotive broker businesses
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. Subdivision 1 of section 736 of the general business law,
as amended by chapter 28 of the laws of 2018, is amended to read as
follows:
1. "Automobile broker business" means any person who, for a fee,
commission or other valuable consideration, regardless of whether such
fee, commission, or consideration is paid directly by a consumer, offers
to provide, provides, or represents that he or she will provide a
service of purchasing, arranging, assisting, facilitating or effecting
the purchase or lease of an automobile as agent, broker, or intermediary
for a consumer. "Automobile broker business" does not include any person
registered as a NEW MOTOR VEHICLE dealer OR QUALIFIED DEALER pursuant to
article sixteen of the vehicle and traffic law, ANY PERSON REGISTERED
UNDER SECTION FOUR HUNDRED FIFTEEN-A OF THE VEHICLE AND TRAFFIC LAW,
ONLY WHEN OPERATING UNDER ACTIVITY COVERED BY SUCH REGISTRATION, AN
AUTOMOBILE AUCTIONEER, ONLY WHEN OPERATING IN THE MANNER DESCRIBED IN
SECTION TWENTY-THREE OF THIS CHAPTER, nor any bona fide employee of a
registered NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer while acting for
such NEW MOTOR VEHICLE DEALER OR QUALIFIED dealer, or any person who
sells, offers for sale or lease or acts as agent, broker or intermediary
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD07655-05-2
S. 4332--B 2 in effecting the purchase or lease of three or fewer automobiles in any calendar year, any national service which aggregates information for consumers, but does not otherwise have contact with consumers, [or] any motor vehicle franchisor, manufacturer, or distributor, DISTRIBUTOR BRANCH OR FACTORY BRANCH registered under article sixteen of the vehicle and traffic law. § 2. Section 736-a of the general business law, as added by chapter 477 of the laws of 2017, is amended to read as follows: § 736-a. Registration required. 1. (A) No person shall engage in busi- ness as an automobile broker business, as defined in section seven hundred thirty-six of this article, without first having been issued a certificate of registration for an automobile broker business pursuant to paragraph c of subdivision seven of section four hundred fifteen of the vehicle and traffic law. A CERTIFICATE OF REGISTRATION FOR AN AUTO- MOBILE BROKER BUSINESS SHALL BE VALID FOR A PERIOD OF TWO YEARS. (B) NO AUTOMOBILE BROKER BUSINESS SHALL REPRESENT OR ACCEPT PAYMENT FROM, EITHER DIRECTLY OR INDIRECTLY, A FRANCHISEE, DEALER, FRANCHISOR, MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR FACTORY BRANCH, AS SUCH TERMS ARE DEFINED IN SECTIONS FOUR HUNDRED FIFTEEN AND FOUR HUNDRED SIXTY-TWO OF THE VEHICLE AND TRAFFIC LAW. (C) NO AUTOMOBILE BROKER BUSINESS SHALL PERFORM ANY SERVICES INVOLVING THE PURCHASING, ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF AN AUTOMOBILE AS AGENT, BROKER, OR INTERMEDIARY FOR A CONSUMER, UNLESS DONE PURSUANT TO A CONTRACT THAT COMPLIES WITH THE PROVISIONS OF SECTION SEVEN HUNDRED THIRTY-EIGHT OF THIS ARTICLE. 2. A certificate of registration for an automobile broker business shall not permit the registrant to display for sale or lease any new or used motor vehicles without registration as a dealer under section four hundred fifteen of the vehicle and traffic law. 3. ANY PERSON THAT SELLS OR LEASES FIVE OR MORE VEHICLES IN A CALENDAR YEAR TO OR THROUGH ONE OR MORE AUTOMOBILE BROKER BUSINESS SHALL BE DEEMED TO BE DEALING IN MOTOR VEHICLES AS THAT TERM IS USED IN PARAGRAPH A OF SUBDIVISION ONE OF SECTION FOUR HUNDRED FIFTEEN OF THE VEHICLE AND TRAFFIC LAW. 4. THE COMMISSIONER OF MOTOR VEHICLES SHALL ADOPT RULES AND REGU- LATIONS NECESSARY TO EFFECTUATE THE PROVISIONS OF THIS SECTION, INCLUD- ING REGULATIONS THAT REQUIRE THE DISCLOSURE OF THE NAME, ADDRESS, AND REGISTRATION NUMBER OF AN AUTOMOBILE BROKER BUSINESS THAT PROVIDED THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF ANY NEW MOTOR VEHICLE, AND THE FEE COLLECTED BY THE BROKER FROM THE CONSUMER FOR PROVIDING SUCH SERVICE. SUCH RULES AND REGULATIONS SHALL REQUIRE THAT SUCH INFORMATION OF THE AUTOMOBILE BROKER BUSINESS AND ITS FEE FOR SERVICE BE PRINTED ON ANY INVOICE, BILL OF SALE, OR BUYER'S ORDER, AND ON ANY APPLICATION FOR REGISTRATION OR TITLE SUBMIT- TED BY ANY DEALER TO THE DEPARTMENT OF MOTOR VEHICLES ON BEHALF OF THE CONSUMER RELATED TO SUCH PURCHASED OR LEASED MOTOR VEHICLE. § 3. The opening paragraph and paragraph (e) of subdivision 1 and subdivisions 3 and 4 of section 738 of the general business law, the opening paragraph and paragraph (e) of subdivision 1 as amended and subdivision 4 as added by chapter 28 of the laws of 2018 and subdivision 3 as amended by chapter 477 of the laws of 2017, are amended to read as follows: Every contract between a consumer and an automobile broker business for the purchase of [an automobile] A MOTOR VEHICLE, OTHER THAN A NEW MOTOR VEHICLE, shall be in writing, shall be dated, shall contain the street address of the automobile broker business and the consumer and S. 4332--B 3 shall be signed by the consumer and by the automobile broker business. Every contract shall comply with the requirements set forth in this section and contain the following: (e) A description of any other services and an itemization of the charges for each. Such description shall include disclosure of the auto- mobile dealer from which the automobile was purchased, as well as all fees, commissions or other valuable [considerations paid by an automo- bile dealer] CONSIDERATION OWED BY THE CONSUMER to the automobile broker business for selling, arranging, assisting or effecting the sale of an automobile as agent, broker, or intermediary between the consumer and the automobile dealer. 3. EVERY CONTRACT BETWEEN A CONSUMER AND AN AUTOMOBILE BROKER BUSINESS FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE SHALL BE IN WRITING, SHALL BE DATED, SHALL CONTAIN THE STREET ADDRESS OF THE AUTOMOBILE BROKER BUSI- NESS AND THE CONSUMER, AND SHALL BE SIGNED BY THE CONSUMER AND BY THE AUTOMOBILE BROKER BUSINESS. EVERY SUCH CONTRACT SHALL COMPLY WITH THE REQUIREMENTS SET FORTH IN THIS SECTION AND CONTAIN THE FOLLOWING PROVISIONS, WHICH SHALL BE PRINTED IN AT LEAST TWELVE-POINT BOLD TYPE AND SHALL NOT BE NEGATED OR SUPERSEDED BY ANY ADDITIONAL PROVISION: (A) A TITLE, ACROSS THE TOP OF THE DOCUMENT IN AT LEAST SIXTEEN-POINT BOLD TYPE, OF "CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE". (B) A STATEMENT OF WHETHER A SOLICITED NEW MOTOR VEHICLE IS OR WILL BE MANUFACTURED IN ACCORDANCE WITH UNITED STATES SPECIFICATIONS AND IS OR WILL BE CERTIFIED BY THE MANUFACTURER AS SUCH IF THE NEW MOTOR VEHICLE IS NOT OR WILL NOT BE MANUFACTURED IN ACCORDANCE WITH UNITED STATES SAFETY AND ENVIRONMENTAL SPECIFICATIONS, AND THE CONSUMER HAS RETAINED THE AUTOMOBILE BROKER BUSINESS TO ARRANGE FOR THE MODIFICATION OF THE NEW MOTOR VEHICLE TO MEET SUCH SPECIFICATIONS, THE NAME AND STREET ADDRESS OF THE MODIFICATION FACILITY AND A STATEMENT IN IMMEDIATE PROX- IMITY TO SUCH INFORMATION THAT THE AUTOMOBILE BROKER BUSINESS ASSUMES FULL FINANCIAL RESPONSIBILITY THAT THE NEW MOTOR VEHICLE WILL BE PROPER- LY MODIFIED TO MEET ALL UNITED STATES SAFETY AND ENVIRONMENTAL SPECIFI- CATIONS. (C) A STATEMENT THAT THE CONSUMER MAY CANCEL THE CONTRACT FOR AUTOMO- BILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE FOR ANY REASON WITHIN THREE DAYS OF THE EXECUTION OF SUCH CONTRACT AND THAT THE CONSUMER HAS THE RIGHT TO A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING RECEIPT OF THE NOTICE OF CANCELLATION. (D) A STATEMENT THAT, IF THE REQUESTED NEW MOTOR VEHICLE CANNOT BE PROCURED BY THE AUTOMOBILE BROKER BUSINESS WITHIN THIRTY DAYS FOLLOWING THE DATE OF EXECUTION OF THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE, THE CONSUMER HAS THE RIGHT TO CANCEL THE CONTRACT AND TO RECEIVE A FULL REFUND WITHIN TEN BUSINESS DAYS FOLLOWING RECEIPT OF THE REQUEST FOR A REFUND, UNLESS THE DELAY IN DELIVERY IS ATTRIBUTABLE TO THE CONSUMER. (E) A STATEMENT THAT THE CONSUMER SHALL BE PROVIDED WITH THE CONTENTS OF EACH BID RECEIVED BY THE AUTOMOBILE BROKER BUSINESS IN RESPONSE TO ITS SOLICITATION ON BEHALF OF SUCH CONSUMER. (F) THE AMOUNT OF THE FEE TO BE PAID BY THE CONSUMER TO THE AUTOMOBILE BROKER BUSINESS FOR THE SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE. (G) A STATEMENT THAT THE SINGLE FEE AUTHORIZED BY SUCH CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE IS INCLUSIVE OF ALL CHARGES INCIDENT TO THE PURCHASING, ARRANGING, ASSISTING, FACILITAT- S. 4332--B 4 ING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHICLE BY THE AUTOMOBILE BROKER BUSINESS AS AGENT, BROKER, OR INTERMEDIARY AND THAT NO OTHER CHARGE OR EXPENSE WHATSOEVER SHALL BE TAKEN, RECEIVED, RESERVED OR CONTRACTED FOR BY THE AUTOMOBILE BROKER BUSINESS FOR SUCH SERVICES. 4. THE CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE SHALL BE ACCOMPANIED BY A COMPLETED FORM IN DUPLICATE, CAPTIONED "NOTICE OF CANCELLATION" WHICH SHALL BE ATTACHED TO THE CONTRACT AND EASILY DETACHABLE, AND WHICH SHALL CONTAIN IN AT LEAST TWELVE-POINT TYPE THE FOLLOWING: "NOTICE OF CANCELLATION YOU MAY CANCEL THIS CONTRACT FOR AUTOMOBILE BROKERING SERVICES FOR A NEW MOTOR VEHICLE, WITHOUT ANY PENALTY OR OBLIGATION, WITHIN THREE DAYS FROM THE DATE THAT A COPY OF AN EXECUTED CONTRACT IS RECEIVED BY YOU. YOU MAY ALSO CANCEL THIS CONTRACT, WITHOUT PENALTY OR OBLIGATION, IF THE AUTOMOBILE BROKER BUSINESS DOES NOT PRODUCE A BID MEETING YOUR SPECIFI- CATIONS WITHIN THIRTY DAYS OF THE DATE OF EXECUTION OF THIS CONTRACT. TO CANCEL THIS CONTRACT, MAIL OR DELIVER A SIGNED AND DATED COPY OF THIS CANCELLATION NOTICE, OR ANY OTHER WRITTEN NOTICE, TO (NAME OF AUTO- MOBILE BROKER BUSINESS) AT (ADDRESS OF AUTOMOBILE BROKER BUSINESS) NOT LATER THAN MIDNIGHT OF THE THIRD DAY FOLLOWING YOUR RECEIPT OF A SIGNED CONTRACT. I HEREBY CANCEL THIS TRANSACTION. ________________________________ (SIGNATURE OF CONSUMER) _____________________ (DATE)" 5. An automobile broker business shall deliver to the consumer or mail to him or her at the address shown on [the] ANY contract REQUIRED BY THIS SECTION, an executed copy thereof. [4. An] 6. IN ADDITION TO THE BROKERING SERVICES AGREEMENT REQUIRED BY SUBDIVISION ONE OF THIS SECTION, AN automobile broker business in any transaction involving the lease of a vehicle shall provide the retail lessee with a retail lease agreement as provided for in section three hundred thirty-seven of the personal property law. [The automobile broker shall provide a written disclosure of the amount of any fee, commission or other consideration paid or expected to be paid by the lessor to the automobile broker business in connection with a trans- action involving the lease of a vehicle. Such disclosure shall be signed by the retail lessee. The automobile broker business shall provide the retail lessee with a signed copy of such disclosure together with the retail lease agreement referenced herein.] NOTHING IN THIS SECTION SHALL BE CONSTRUED TO PERMIT THE DELIVERY OF AN EXECUTED RETAIL LEASE AGREE- MENT TO A NEW MOTOR VEHICLE BY A PERSON OTHER THAN THE PROSPECTIVE LESSEE. § 4. Subdivision 1 of section 740-a of the general business law, as amended by chapter 477 of the laws of 2017, is amended to read as follows: 1. Automobile broker businesses shall obtain and continue in effect a surety bond in an amount of [one] TWO hundred FIFTY thousand dollars executed by a surety company authorized to transact business in the state by the department of financial services of the state or its successor. The bonds shall be approved as to form by the secretary of state and shall be conditioned on the automobile broker business' payment of all valid bank drafts, including checks, drawn for the purchase of motor vehicles and safekeeping of all customer deposits related to the sale of a motor vehicle between the time of receipt of such customer deposit and the transfer of good title to the vehicle to the customer. S. 4332--B 5 § 5. Section 741 of the general business law, as added by chapter 616 of the laws of 1988, is amended to read as follows: § 741. Deceptive acts AND FRAUDS prohibited. 1. It is hereby declared to be a deceptive trade practice and unlawful for an automobile broker business to misrepresent directly or indirectly in its advertising, promotional materials, sales presentation, or in any manner: [1.] (A) The nature of the services to be performed AND THAT A THIRD PARTY WILL BE PAYING FOR ANY SUCH SERVICES; [2.] (B) The time within which the services will be performed; [3.] (C) The cost of the services to be performed; [and 4.] (D) The ability of the automobile broker business to perform the services; AND (E) THAT THE AUTOMOBILE BROKER BUSINESS IS AFFILIATED WITH ANY NEW MOTOR VEHICLE MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH AND/OR FACTORY BRANCH INCLUDING THE USE OF ANY TRADEMARKS OR COPYRIGHTED MATE- RIAL WITHOUT THE EXPRESS, WRITTEN CONSENT OF THE OWNER OF SUCH MATERIAL. 2. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO REFUSE TO DISCLOSE ITS REGISTRATION NUMBER, ISSUED EITHER BY THE STATE OR A MUNICIPALITY, TO A MOTOR VEHICLE DEALER. FURTHERMORE, IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSI- NESS TO MAKE ANY MISREPRESENTATION TO A MOTOR VEHICLE DEALER OR NEW MOTOR VEHICLE DEALER REGARDING THE ELIGIBILITY OF ANY CONSUMER FOR ANY DISCOUNTS, REDUCTIONS OR ANY BENEFIT PROGRAMS REGARDING THE SALE OR LEASE OF A MOTOR VEHICLE. 3. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO ADVERTISE NEW MOTOR VEHICLES, THROUGH ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM, WITHOUT DISCLOSING THAT IT IS NOT A LICENSED MOTOR VEHICLE DEALER AND IS NOT AN AUTHORIZED SATELLITE LOCATION FOR ANY PARTICULAR LICENSED MOTOR VEHICLE DEALER. 4. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO ADVERTISE THROUGH ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM, THAT WOULD LEAD A REASON- ABLE CONSUMER TO CONCLUDE THAT THE AUTOMOBILE BROKER BUSINESS IS A LICENSED NEW MOTOR VEHICLE DEALER. 5. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO MAINTAIN ANY WEBSITE WITHOUT INCLUDING A TEXT BOX WITH THE FOLLOWING STATEMENT IN NO LESS THAN EIGHTEEN-POINT BOLDFACE TYPE ON THE SPLASH PAGE: "(BROKER NAME) IS NOT A LICENSED NEW MOTOR VEHICLE DEALER IN THE STATE OF NEW YORK, NOR IS IT AN AUTHORIZED AFFILIATE OF ANY LICENSED NEW MOTOR VEHICLE DEALER IN THE STATE OF NEW YORK". 6. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO INCLUDE ANY PRICING OR FINANCING OFFERS OR PROMOTIONS IN ANY ADVERTISEMENT, INCLUDING ANY PRINT, ELECTRONIC OR DIGITAL SIGNAL OR MEDIUM, WRITTEN OR VERBAL STATEMENT OR WORD, DESIGN, DEVICE, SOUND OR ANY COMBINATION OF ANY SUCH METHOD OR MEDIUM. 7. IT SHALL BE A FRAUDULENT BUSINESS PRACTICE FOR AN AUTOMOBILE BROKER BUSINESS TO GAIN ACCESS TO OR USE, OR REPRESENT OR ADVERTISE THAT IT MAY ACCESS OR USE, A PORTAL, COMPUTER, OR INTERNET ACCOUNT OWNED BY OR RESERVED FOR A NEW MOTOR VEHICLE DEALER TO ACCESS OR USE ONE OR MORE FINANCE SOURCES THAT PROVIDE AUTOMOTIVE-RELATED LOANS, OR PURCHASES RETAIL INSTALLMENT CONTRACTS OR LEASE CONTRACTS FOR MOTOR VEHICLES. § 6. Section 741-b of the general business law, as added by chapter 28 of the laws of 2018, is amended to read as follows: S. 4332--B 6 § 741-b. [Disclosure] DISCLOSURES REQUIRED BY BROKERS. 1. An automo- bile broker business shall GENERATE AND provide a disclosure at the time such automobile broker business takes an order to search for a leased OR PURCHASED vehicle meeting the prospective BUYER OR lessee's specifica- tions. Such disclosure shall provide the amount of any fees, commissions or other valuable consideration the automobile broker business expects to receive, if known, from [a dealer, lessor or] any [other] person or entity for any assistance the automobile broker business provides in effecting the PURCHASE OR lease transaction. If the amount of any such fees, commissions or other valuable consideration the automobile broker business expects to receive is unknown at the time of the required disclosure, the automobile broker business shall disclose[: (a)] whether it has a contract with any dealer, lessor or any other person or entity for the provision of assistance in effecting a PURCHASE OR lease trans- action[; and (b) whether the automobile broker business may be compen- sated by the dealer, lessor or any other person or entity for any assistance in effecting such lease transaction]. NOTHING IN THIS SUBDI- VISION SHALL BE CONSTRUED TO PERMIT THE PAYMENT OF ANY FEES, COMMISSIONS OR OTHER VALUABLE CONSIDERATION TO AN AUTOMOBILE BROKER BUSINESS BY ANY MOTOR VEHICLE DEALER. 2. AN AUTOMOBILE BROKER BUSINESS SHALL GENERATE AND PROVIDE AN ADDI- TIONAL DISCLOSURE TO THE CONSUMER AT THE TIME SUCH AUTOMOBILE BROKER BUSINESS TAKES AN ORDER TO SEARCH FOR A MOTOR VEHICLE MEETING THE PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS. SUCH ADDITIONAL DISCLOSURE SHALL STATE THE FOLLOWING: (A) THAT THE AUTOMOBILE BROKER BUSINESS SHALL MAKE A BONA FIDE ATTEMPT TO OBTAIN A BID, QUOTE OR OFFER ON BEHALF OF THE PROSPECTIVE BUYER OR LESSEE FOR A MOTOR VEHICLE MEETING THE PROSPECTIVE BUYER OR LESSEE'S SPECIFICATIONS; (B) THAT THE AUTOMOBILE BROKER BUSINESS SHALL PROVIDE TO THE CONSUMER ALL CONTENTS OF EACH BID MADE BY A MOTOR VEHICLE DEALER IN RESPONSE TO THE SOLICITATION OF THE AUTOMOBILE BROKER BUSINESS; AND (C) THAT THE AUTOMOBILE BROKER BUSINESS HAS A DUTY TO ACT FOR THE BENEFIT OF THE PROSPECTIVE BUYER OR LESSEE. 3. EACH DISCLOSURE REQUIRED BY THIS SECTION TO BE MADE TO A CONSUMER SHALL BE ACKNOWLEDGED IN WRITING BY EACH CONSUMER. 4. AT THE TIME AN AUTOMOBILE BROKER BUSINESS SOLICITS A BID FROM A NEW MOTOR VEHICLE DEALER, SUCH BROKER SHALL PROVIDE A DISCLOSURE TO EACH SOLICITED DEALER AS TO THE PROVISIONS OF SECTION SEVEN HUNDRED THIRTY- NINE OF THIS ARTICLE. 5. PRIOR TO THE EXECUTION OF ANY PURCHASE CONTRACT OR LEASE FOR AN AUTOMOBILE, AN AUTOMOBILE BROKER BUSINESS SHALL PROVIDE EACH CONSUMER WITH ALL DISCLOSURES REQUIRED TO BE MADE BY A DEALER. § 7. The general business law is amended by adding a new section 741-c to read as follows: § 741-C. PRIVATE INFORMATION SECURITY. 1. AN AUTOMOBILE BROKER BUSI- NESS SHALL REPORT ANNUALLY TO THE DEPARTMENT OF MOTOR VEHICLES ITS COMPLIANCE WITH SECTIONS THREE HUNDRED NINETY-NINE-CC, THREE HUNDRED NINETY-NINE-DD, THREE HUNDRED NINETY-NINE-DDD, THREE HUNDRED NINETY- NINE-H, THREE HUNDRED NINETY-NINE-OO, THREE HUNDRED NINETY-NINE-P, THREE HUNDRED NINETY-NINE-PP, AND EIGHT HUNDRED NINETY-NINE-BB OF THIS CHAP- TER. FOR THE PURPOSES OF SUBDIVISION TWO OF SECTION EIGHT HUNDRED NINE- TY-NINE-BB OF THIS CHAPTER, AN AUTOMOBILE BROKER BUSINESS SHALL NOT BE CONSIDERED A SMALL BUSINESS AS THAT TERM IS DEFINED IN THAT SECTION AND SHALL INSTEAD BE SUBJECT TO REASONABLE SECURITY REQUIREMENTS THAT ARE EQUIVALENT TO THOSE APPLICABLE TO NEW MOTOR VEHICLE DEALERS. S. 4332--B 7 2. IN ADDITION TO THE REQUIREMENTS OF SUBDIVISION ONE OF THIS SECTION, AN AUTOMOBILE BROKER BUSINESS SHALL: (A) KEEP AND MAINTAIN ALL CONSUMER RECORDS CONTAINING PRIVATE INFORMA- TION IN A SAFE PLACE THAT IS NOT ACCESSIBLE TO PERSONS NOT EMPLOYED BY THE AUTOMOBILE BROKER BUSINESS, INCLUDING BY KEEPING AND MAINTAINING A CLEAR AND PERMANENT PHYSICAL BARRIER FROM OTHER BUSINESSES THAT SHARE OR NEIGHBOR ITS PLACE OF BUSINESS; (B) HAVE A MAILBOX AT SUCH PLACE OF BUSINESS DEDICATED ONLY TO THE AUTOMOBILE BROKER BUSINESS; AND (C) HAVE A METHOD OF LOCKING SECURITY ITEMS, INCLUDING A LOCKING CABI- NET OR SAFE. 3. NO TRANSACTION FOR THE PURCHASE OR LEASE OF A NEW MOTOR VEHICLE THAT WAS ARRANGED, ASSISTED, FACILITATED OR EFFECTED BY AN AUTOMOBILE BROKER BUSINESS SHALL BE VALID UNLESS THE CONSUMER PERSONALLY DELIVERS AN EXECUTED PURCHASE CONTRACT OR LEASE, AND, WHERE APPLICABLE, FINANCING AGREEMENT, TO THE PLACE OF BUSINESS OF THE DEALER FROM WHICH SUCH VEHI- CLE WILL BE PURCHASED OR LEASED AND SUCH DEALER VERIFIES THE IDENTITY OF SUCH CONSUMER. § 8. Section 743 of the general business law, as amended by chapter 372 of the laws of 2016, is amended to read as follows: § 743. Enforcement [by]. 1. BY attorney general. In addition to the other remedies provided, whenever there shall be a violation of this article, application may be made by the attorney general in the name of the people of the state of New York to a court or justice having juris- diction by a special proceeding to issue an injunction, and upon notice to the defendant of not less than five days, to enjoin and restrain the continuance of such violations; and if it shall appear to the satisfac- tion of the court or justice that the defendant has, in fact, violated this article, an injunction may be issued by such court or justice, enjoining and restraining any further violation, without requiring proof that any person has, in fact, been injured or damaged thereby. In any such proceeding, the court may make allowances to the attorney general as provided in paragraph six of subdivision (a) of section eighty-three hundred three of the civil practice law and rules, and direct restitu- tion. Whenever the court shall determine that a violation of this arti- cle has occurred, the court shall impose a civil penalty of not less than [one] FOUR thousand dollars and not more than [three] TEN thousand dollars for each violation. In connection with any such proposed appli- cation, the attorney general is authorized to take proof and make a determination of the relevant facts and to issue subpoenas in accordance with the civil practice law and rules. 2. BY LOCAL AUTHORITIES. (A) MUNICIPALITIES MAY, PURSUANT TO LOCAL LAW, ACT UPON THE BUSINESS ACTIVITY THAT IS THE SUBJECT OF THIS ARTICLE, PROVIDED THAT NO LOCAL GOVERNMENT MAY DIMINISH THE PROTECTIONS OR REQUIREMENTS OF THIS ARTICLE OR PREVENT ENFORCEMENT OF ITS PROVISIONS BY APPROPRIATE STATE OFFICIALS. (B) THE PROVISIONS OF THIS ARTICLE MAY BE ENFORCED IN THE SAME MANNER AS SET FORTH IN SUBDIVISION ONE OF THIS SECTION BY THE DIRECTOR OF A MUNICIPAL CONSUMER AFFAIRS OFFICE OR A BUSINESS INTEGRITY COMMISSION, OR BY THE TOWN ATTORNEY, CITY CORPORATION COUNSEL, OR OTHER LAWFULLY DESIG- NATED ENFORCEMENT OFFICER OF A MUNICIPALITY OR LOCAL GOVERNMENT, AND ALL MONIES COLLECTED THEREUNDER SHALL BE RETAINED BY SUCH MUNICIPALITY OR LOCAL GOVERNMENT, PROVIDED THAT NO LOCAL GOVERNMENT MAY PREVENT ENFORCE- MENT OF ITS PROVISIONS BY APPROPRIATE STATE OFFICIALS. 3. BY PRIVATE PARTY. ANY PERSONS THAT ARE OR MAY BE INJURED BY ANY VIOLATION OF THIS ARTICLE MAY BRING AN ACTION IN HIS OR HER OWN NAME S. 4332--B 8 AGAINST AN AUTOMOBILE BROKER BUSINESS TO ENJOIN SUCH UNLAWFUL ACT OR PRACTICE, AN ACTION TO RECOVER HIS OR HER DAMAGES AND STATUTORY DAMAGES OF NOT LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION, OR BOTH SUCH ACTIONS. INJURY SHALL INCLUDE, BUT NOT BE LIMITED TO, LOST SALES ON ACCOUNT OF DECEPTIVE OR UNFAIR ADVERTISING. DAMAGES SHALL INCLUDE, BUT NOT BE LIMITED TO, LOST SALES AND THE VALUE OF INCENTIVE PAYMENTS, BONUSES, HOLDBACKS OR SIMILAR PAYMENTS THAT WOULD HAVE BEEN REALIZED BUT FOR THE ACTIONS OF A PERSON WHO KNOWINGLY AIDED THE VIOLATION OF THE PROVISIONS OF THIS ARTICLE. NOTHING IN THIS SECTION SHALL REQUIRE A FRANCHISOR, MANUFACTURER, OR DISTRIBUTOR TO GRANT A NEW MOTOR VEHICLE DEALER A BENEFIT UNDER AN INCENTIVE, BONUS, HOLDBACK OR SIMILAR PAYMENT THAT THE NEW MOTOR VEHICLE DEALER DID NOT EARN OR FOR WHICH THE NEW MOTOR VEHICLE DEALER DID NOT QUALIFY. SUCH ACTIONS MAY BE BROUGHT REGARDLESS OF WHETHER OR NOT THE UNDERLYING VIOLATION IS CONSUMER-ORIENTED OR HAS A PUBLIC IMPACT. GIVEN THE REMEDIAL NATURE OF THIS SUBDIVISION, STANDING TO BRING AN ACTION UNDER THIS SUBDIVISION SHALL BE LIBERALLY CONSTRUED AND SHALL BE AVAIL- ABLE TO THE FULLEST EXTENT OTHERWISE PERMITTED BY LAW. THE COURT MAY, IN ITS DISCRETION, AWARD TREBLE DAMAGES IF THE COURT FINDS THE DEFENDANT WILLFULLY OR KNOWINGLY VIOLATED THIS ARTICLE. THE COURT SHALL AWARD REASONABLE ATTORNEY'S FEES AND COSTS TO A PREVAILING PLAINTIFF. § 9. Paragraph a of subdivision 1 of section 415 of the vehicle and traffic law, as amended by chapter 554 of the laws of 2015, is amended to read as follows: a. "Dealer" means a person engaged in the business of buying, selling or dealing in motor vehicles, motorcycles or trailers, other than mobile homes or manufactured homes, at retail or wholesale; except, however, trailers with an unladen weight of less than one thousand pounds. For the purposes of this section, a "mobile home" or "manufactured home" means a mobile home or manufactured home as defined in section one hundred twenty-two-c of this chapter. Any person who sells, or offers for sale OR LEASE more than five motor vehicles, motorcycles or trailers in any calendar year or who displays or permits the display of three or more motor vehicles, motorcycles or trailers for sale at any one time or within any one calendar month upon premises owned or controlled by him or her, if such vehicles were purchased, acquired or otherwise obtained by such person for the purpose of resale, will be regarded as a dealer. FOR THE PURPOSES OF THIS SECTION, "OFFERS FOR SALE OR LEASE" SHALL INCLUDE, BUT NOT BE LIMITED TO, THE ACT OF DRAWING THE PUBLIC'S ATTEN- TION TO, OR THE PRESENTATION OR DISPLAY OF ANY MOTOR VEHICLE, INCLUDING THE POSTING OF IMAGES OF ANY SUCH VEHICLE, TOGETHER WITH A SUGGESTED RETAIL PRICE, LEASE COST OR FINANCING RATE FOR SUCH VEHICLE AND AN OFFER TO PROVIDE, THE PROVISION OF, OR A REPRESENTATION THAT SUCH PERSON MAY PROVIDE A SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE LEASE OF SUCH NEW MOTOR VEHICLE, EXCEPT THIS MEANING SHALL NOT APPLY TO ANY ACTIVITY OF A COOPERATIVE OR OTHER ADVERTISING PROGRAM OR FUND AS DESCRIBED IN ANY FRANCHISE, AS SUCH TERM IS DEFINED BY SUBDIVISION SIX OF SECTION FOUR HUNDRED SIXTY-TWO OF THIS TITLE, OR THE DISPLAY OF AGGREGATED INFORMATION AND IMAGES BY A NATIONAL SERVICE THAT OTHERWISE DOES NOT HAVE CONTACT WITH CONSUMERS. Except as otherwise provided in subdivisions three, five, six-b, and seven of this section, the term "dealer" shall include a "new motor vehicle dealer" as defined by para- graph f of this subdivision and a "qualified dealer" as defined in para- graph g of this subdivision. § 10. Subdivision 3 of section 415 of the vehicle and traffic law is amended by adding a new paragraph d to read as follows: S. 4332--B 9 D. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR A DEALER TO USE ANY SUBSIDIARY CORPORATION, AFFILIATED CORPORATION, OR ANY OTHER CONTROLLED CORPORATION, PARTNERSHIP, ASSOCIATION, BUSINESS OR PERSON TO ACCOMPLISH WHAT WOULD OTHERWISE BE UNLAWFUL CONDUCT UNDER THIS ARTICLE OR ARTICLE THIRTY-FIVE-B OF THE GENERAL BUSINESS LAW, INCLUDING REQUEST- ING THAT AN AUTOMOBILE BROKER BUSINESS REPRESENT SUCH DEALER IN GENERAT- ING A SALE OR LEASE OR MAKING PAYMENT TO, EITHER DIRECTLY OR INDIRECTLY, AN AUTOMOBILE BROKER BUSINESS. § 11. Subdivision 3-a and paragraph b-3 of subdivision 5 of section 415 of the vehicle and traffic law, as added by chapter 477 of the laws of 2017, are amended to read as follows: 3-a. Automobile broker business registration. A. No person shall engage in the automobile broker business or represent or advertise that he or she is engaged or intends to engage in the automobile broker busi- ness in this state, unless there shall have been issued to him or her a certificate of registration as an automobile broker business by the commissioner under this section pursuant to an application for registra- tion submitted pursuant to subdivision five of this section. SUCH REGIS- TRATION SHALL BE EFFECTIVE FOR A PERIOD NOT EXCEEDING TWO YEARS. AT THE DISCRETION OF THE COMMISSIONER A REGISTRATION MAY BE RENEWED FOR A PERI- OD OF UP TO TWO YEARS UPON APPLICATION THEREFOR, IN SUCH FORM AS THE COMMISSIONER MAY PRESCRIBE, AND A SHOWING OF PROOF OF SATISFACTION OF THE REQUIREMENTS OF SECTION SEVEN HUNDRED FORTY-A OF THE GENERAL BUSI- NESS LAW, AND UPON PAYMENT OF THE FEE AS HEREIN PRESCRIBED. B. THE COMMISSIONER SHALL NOT ISSUE OR RENEW A CERTIFICATE OF REGIS- TRATION AUTHORIZED BY THIS SUBDIVISION TO ANY DEALER, FRANCHISEE, FRAN- CHISOR, MANUFACTURER, DISTRIBUTOR, DISTRIBUTOR BRANCH OR FACTORY BRANCH, AS SUCH TERMS ARE DEFINED IN SECTION FOUR HUNDRED SIXTY-TWO OF THIS TITLE, OR TO ANY SUBSIDIARY, AFFILIATE, EMPLOYEE OR CONTROLLED PERSON OR ENTITY THEREOF. C. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED PURSUANT TO THIS SUBDIVISION, AN AUTOMOBILE BROKER BUSINESS SHALL HAVE, AND CONTINUOUSLY MAINTAIN, A PLACE OF BUSINESS IN THIS STATE FOR WHICH IT SHALL KEEP AND MAINTAIN EVIDENCE THAT ALL NECESSARY APPROVALS, LICENSES AND/OR PERMITS HAVE BEEN OBTAINED FROM ALL LOCAL GOVERNING BODIES TO OPERATE SUCH PLACE OF BUSINESS WITH CUSTOMER OR CLIENT TRAF- FIC. NO MORE THAN ONE AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT ANY SINGLE LOCATION AND NO AUTOMOBILE BROKER BUSINESS SHALL OPERATE AT THE SAME LOCATION AS A NEW MOTOR VEHICLE DEALER. D. EVERY REGISTERED AUTOMOBILE BROKER BUSINESS SHALL PROMINENTLY AND CONSPICUOUSLY POST, IN SUCH A MANNER THAT IT IS LIKELY TO BE NOTICEABLE TO ANYONE ENTERING ITS PREMISES, ITS OFFICIAL BUSINESS CERTIFICATE OF REGISTRATION AND A SIGN, WHICH SIGN SHALL CLEARLY STATE: "(NAME OF REGISTERED AUTOMOBILE BROKER) IS NOT A FRANCHISED NEW MOTOR VEHICLE DEALER. WE ARE NOT AUTHORIZED OR APPROVED BY A MANUFACTURER OR DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM RECALL OR ORIGINAL FACTORY WARRANTY WORK." E. AS A CONDITION OF ANY CERTIFICATE OF REGISTRATION ISSUED OR RENEWED PURSUANT TO THIS SUBDIVISION, AND BEFORE PERFORMING ANY BROKER SERVICES RELATED TO A NEW MOTOR VEHICLE, AN AUTOMOBILE BROKER BUSINESS SHALL ATTEST IN WRITING TO EACH CONSUMER, THAT THE BROKER: (I) IS NOT A FRAN- CHISED NEW MOTOR VEHICLE DEALER; AND (II) IS NOT AUTHORIZED OR APPROVED BY A MANUFACTURER OR DISTRIBUTOR TO SELL A NEW MOTOR VEHICLE OR PERFORM RECALL OR ORIGINAL FACTORY WARRANTY WORK. S. 4332--B 10 F. IT IS HEREBY DECLARED TO BE A FRAUDULENT PRACTICE, FOR THE PURPOSES OF PARAGRAPH C OF SUBDIVISION NINE OF THIS SECTION, FOR AN AUTOMOBILE BROKER BUSINESS TO DRAW THE PUBLIC'S ATTENTION TO, OR PRESENT OR DISPLAY ANY NEW MOTOR VEHICLE, INCLUDING BY POSTING IMAGES OF ANY SUCH VEHICLE, TOGETHER WITH A SUGGESTED RETAIL PRICE, LEASE COST OR FINANCING RATE FOR SUCH VEHICLE AND AN OFFER TO PROVIDE, THE PROVISION OF, OR A REPRESEN- TATION THAT SUCH PERSON MAY PROVIDE A SERVICE OF ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH NEW MOTOR VEHI- CLE. G. NOTHING IN THIS SUBDIVISION SHALL BE CONSTRUED TO PROHIBIT A FRAN- CHISOR, MANUFACTURER, OR DISTRIBUTOR FROM SPONSORING ACTIVITIES INTENDED TO GENERATE LEADS TOWARD THE SALE OR LEASE OF A NEW MOTOR VEHICLE BY A FRANCHISEE. b-3. In the case of an application for registration as an automobile broker business, EITHER FOR INITIAL REGISTRATION OR RENEWAL THEREOF, the name and address of the surety company which will issue the bond required by subdivision one of section seven hundred forty-a of the general business law, A COPY OF SUCH BOND CERTIFIED BY THE SECRETARY OF STATE OR ONE OF HIS OR HER AGENTS, AND A STATEMENT INDICATING ANY INTER- EST IN THE APPLICANT'S BUSINESS ENTITY BY A PERSON OR ENTITY DESCRIBED IN PARAGRAPH F OF SUBDIVISION ONE OR PARAGRAPH F OF SUBDIVISION SEVEN OF THIS SECTION, OR ANY EMPLOYEE OR PERSON, CONTROLLING PERSON OR ENTITY THEREOF. If the bond is to be issued by an authorized agent of the sure- ty company licensed by the state, then the name and address of that agent may be provided in lieu of the information concerning the surety company. § 12. Section 415 of the vehicle and traffic law is amended by adding two new subdivisions 21 and 22 to read as follows: 21. PENALTIES AND RIGHTS OF ACTION FOR FAILURE TO OBTAIN A CERTIFICATE OF REGISTRATION AS AN AUTOMOBILE BROKER PURSUANT TO SUBDIVISION THREE-A AND PARAGRAPH B-3 OF SUBDIVISION FIVE OF THIS SECTION. IN ADDITION TO ANY OTHER ACTION AUTHORIZED BY LAW, THE COMMISSIONER, OR ANY PERSON DESIGNATED BY HIM OR HER, MAY PROCEED AGAINST A PARTY WHO HAS OPERATED AS AN AUTOMOBILE BROKER WITHOUT CERTIFICATE OF REGISTRATION IN ACCORD- ANCE WITH THE PROVISIONS OF THIS ARTICLE, IN ANY ONE OR MORE PROCEEDINGS AND BY ORDER TO ENJOIN SUCH UNLAWFUL ACTS OR PRACTICES AND REQUIRING THE OFFENDING PARTY TO PAY THE PEOPLE OF THIS STATE A PENALTY IN A SUM NOT LESS THAN FOUR THOUSAND DOLLARS AND NOT MORE THAN TEN THOUSAND DOLLARS FOR EACH VIOLATION FOUND TO HAVE BEEN COMMITTED. CIVIL PENALTIES ASSESSED UNDER THIS SUBDIVISION SHALL BE PAID TO THE COMMISSIONER FOR DEPOSIT INTO THE STATE TREASURY, AND UNPAID CIVIL PENALTIES MAY BE RECOVERED BY THE COMMISSIONER IN A CIVIL ACTION IN THE NAME OF THE COMMISSIONER. FOR THE PURPOSES OF THIS SUBDIVISION, A "VIOLATION" SHALL MEAN EACH VEHICLE SOLD OR LEASED TO A CONSUMER FOR WHICH THE PARTY THAT FAILED TO OBTAIN CERTIFICATION AS AN AUTOMOBILE BROKER HAS SERVED AS AN AUTOMOBILE BROKER. 22. AUTOMOBILE BROKER RECORD REQUIREMENTS. A. AUTOMOBILE BROKERS SHALL MAINTAIN A PERMANENTLY BOUND BOOK IN WHICH SHALL BE RECORDED THE MAKE, MODEL, YEAR, COLOR AND VEHICLE IDENTIFICATION NUMBER OF ALL NEW MOTOR VEHICLES FOR WHICH SUCH BROKER HAS PROVIDED A SERVICE OF PURCHASING, ARRANGING, ASSISTING, FACILITATING OR EFFECTING THE PURCHASE OR LEASE OF SUCH AUTOMOBILE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL ALSO RECORD IN SUCH BOOK THE NAME AND ADDRESS OF THE PURCHASER OR LESSOR OF SUCH AUTOMOBILE, THE DATE OF SALE OR COMMENCEMENT OF LEASE OF SUCH AUTOMOBILE AND THE NAME AND ADDRESS OF THE DEALER FROM WHICH THE AUTOMO- BILE WAS PURCHASED OR LEASED. S. 4332--B 11 B. AUTOMOBILE BROKER BUSINESSES SHALL MAINTAIN A PERMANENTLY BOUND BOOK IN WHICH SHALL BE RECORDED ALL COMPLETED ORDERS TO SEARCH FOR A NEW MOTOR VEHICLE WITHIN ANY PRECEDING SIX-YEAR PERIOD. SUCH BROKER SHALL ALSO RECORD IN SUCH BOOK THE DATE OF SUCH ORDER, THE NAME AND ADDRESS OF THE PERSON OR ENTITY ORDERING SUCH SEARCH, THE AUTOMOBILE SPECIFICATIONS PROVIDED BY SUCH PROSPECTIVE BUYER OR LESSEE AND THE NAME AND ADDRESS OF THE DEALERS SOLICITED FOR A QUOTE OR OFFER ON BEHALF OF SUCH PROSPECTIVE BUYER OR LESSEE. C. SUCH BOOKS SHALL BE OPEN FOR INSPECTION BY THE COMMISSIONER, OR HIS OR HER AGENT, DURING REASONABLE BUSINESS HOURS. THE COMMISSIONER MAY ESTABLISH BY RULE THE FORM OF ANY SUCH BOOK. D. AS AN ALTERNATIVE TO A BOUND BOOK, AN AUTOMOBILE BROKER MAY USE A COMPUTER AND SOFTWARE APPROVED BY THE DEPARTMENT TO MAINTAIN THE RECORDS REQUIRED TO BE KEPT BY THIS SECTION, PROVIDED ALL INFORMATION REQUIRED BY PARAGRAPHS A AND B OF THIS SECTION ARE RECORDED AND THE RECORDS CONFORM TO SUCH ADDITIONAL REQUIREMENTS AS DETERMINED BY THE COMMISSION- ER. § 13. Nothing in this act shall be construed to limit, or to enlarge, the protections that 47 U.S.C. § 230 confers on an interactive computer service for content provided by another information content provider, as such terms are defined in 47 U.S.C. § 230. § 14. Severability. If any provision of this act, or any application of any provision of this act, is held to be invalid, that shall not affect the validity or effectiveness of any other provision of this act, or of any other application of any provision of this act, which can be given effect without that provision or application; and to that end, the provisions and applications of this act are severable. § 15. This act shall take effect immediately; provided that all auto- mobile brokers registered on the effective date of this act shall have ninety days to come into compliance with the provisions of this act.
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.