NY State Senate Bill 2025-S4741

Senate Bill S4741

2025-2026 Legislative Session

Relates to schemes to defraud and establishing the crime of harassment of a legal services client; repealer

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Current Bill Status - In Senate Committee Codes Committee

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

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 12, 2025	referred to codes

2025-S4741 (ACTIVE) - Details

See Assembly Version of this Bill:: A5366
Current Committee:: Senate Codes
Law Section:: Penal Law
Laws Affected:: Rpld §§190.60 & 190.65, add §§190.60, 190.62, 190.64, 190.66 & 190.68, Title N Art 243 §§243.00 & 243.05, amd §§496.06, 460.10 & 155.05, Pen L; amd §410, Gen Bus L; amd §220-b, Lab L

2025-S4741 (ACTIVE) - Summary

Restructures the crimes of schemes to defraud; establishes the crime of harassment of a legal services client.

2025-S4741 (ACTIVE) - Sponsor Memo

                                 
BILL NUMBER: S4741

SPONSOR: SEPULVEDA
 
TITLE OF BILL:

An act to amend the penal law, the general business law and the labor
law, in relation to schemes to defraud and establishing the crime of
harassment of a legal services client; and to repeal certain provisions
of the penal law relating thereto

 
PURPOSE:

To strengthen the legal protections against fraudulent schemes, partic-
ularly those targeting multiple victims or vulnerable individuals, and
to establish criminal penalties for lawyers who harass or exploit their
clients.

 
SUMMARY OF PROVISIONS:

Section 1: Establishes legislative intent to combat fraudulent schemes
and unethical practices, particularly within legal services, to protect
the public and uphold fairness.

Section 2: Repeals and replaces existing Penal Law §§ 190.60 and 190.65,
expanding the scope of fraud-related offenses by creating five degrees
of the crime of "scheme to defraud," ranging from a class A misdemeanor
(fifth degree) to a class B felony (first degree) based on the number of
victims and financial harm caused.

Section 3-6: Amends various sections of the Penal Law, General Business
Law, and Labor law to reflect the revised fraud statutes and include
these offenses in lists of specified crimes.

Section 7: Amends larceny statutes to allow aggregation of fraudulently
obtained funds from multiple victims across different counties into a
single charge.

Section 8: Adds Article 243 to the Penal Law, creating the new crime of
Harassment of a Legal Services Client, with two degrees:

Second Degree (Class A misdemeanor): When a lawyer withholds client
documents or fails to return unspent retainer funds upon request.

First Degree (Class E felony): When a lawyer threatens to disclose
confidential client information, including immigration status, to coerce
payment or retention of services.

Section 9: Includes a severability clause to preserve the remainder of
the act if any part is deemed invalid.

Section 10: Establishes the effective date as January 1 following enact-
ment.

 
JUSTIFICATION:

Fraudulent schemes and unethical legal practices erode public trust, and
harm vulnerable individuals, and exploit consumers seeking essential
services. This legislation addresses these concerns by:

* Strengthening penalties for large-scale fraud operations targeting
multiple victims.

* Expanding protections for elderly and vulnerable individuals dispro-
portionately affected by fraud.

* Ensuring legal professionals cannot exploit their clients through
coercion, threats, or withholding essential documents.

* Allowing prosecution of fraudulent schemes that span multiple juris-
dictions by consolidating charges.

By updating fraud statutes and establishing new protections for legal
services clients, this bill upholds justice, deters misconduct, and
safeguards the rights of consumers.

 
LEGISLATIVE HISTORY:

This is a new bill.

 
FISCAL IMPLICATIONS:

Minimal administrative costs anticipated for enforcement and prose-
cution.

 
EFFECTIVE DATE:
This act shall take effect on January 1 following enactment.

2025-S4741 (ACTIVE) - Bill Text download pdf

                             
                     S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4741
 
                        2025-2026 Regular Sessions
 
                             I N  S E N A T E
 
                             February 12, 2025
                                ___________
 
 Introduced by Sen. SEPULVEDA -- read twice and ordered printed, and when
   printed to be committed to the Committee on Codes
 
 AN  ACT  to  amend the penal law, the general business law and the labor
   law, in relation to schemes to defraud and establishing the  crime  of
   harassment   of  a  legal  services  client;  and  to  repeal  certain
   provisions of the penal law relating thereto
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:
 
   Section  1.  Legislative intent. The legislature finds that fraudulent
 schemes and unethical practices,  particularly  by  legal  professionals
 entrusted  with significant responsibilities, undermine public trust and
 harm clients. This act  aims  to  strengthen  protections  against  such
 conduct,  ensure accountability, and uphold fairness and transparency in
 legal services and professional interactions.
   § 2. Sections 190.60 and 190.65 of the penal law are REPEALED and five
 new sections 190.60, 190.62, 190.64, 190.66 and 190.68 are added to read
 as follows:
 § 190.60 SCHEME TO DEFRAUD IN THE FIFTH DEGREE.
   A PERSON IS GUILTY OF SCHEME TO DEFRAUD IN THE FIFTH DEGREE WHEN  THEY
 ENGAGE IN A SYSTEMATIC, ONGOING COURSE OF CONDUCT WITH INTENT TO DEFRAUD
 MORE  THAN ONE PERSON OR TO OBTAIN PROPERTY FROM MORE THAN ONE PERSON BY
 FALSE PRETENSES, REPRESENTATIONS, OR PROMISES, AND  SO  OBTAIN  PROPERTY
 FROM ONE OR MORE SUCH PERSONS.
   SCHEME TO DEFRAUD IN THE FIFTH DEGREE IS A CLASS A MISDEMEANOR.
 § 190.62 SCHEME TO DEFRAUD IN THE FOURTH DEGREE.
   A  PERSON  IS  GUILTY  OF  SCHEME TO DEFRAUD IN THE FOURTH DEGREE WHEN
 THEY:
   1. ENGAGE IN SUCH CONDUCT WITH INTENT TO DEFRAUD TEN OR MORE  PERSONS;
 OR
   2. OBTAIN PROPERTY EXCEEDING ONE THOUSAND DOLLARS IN VALUE; OR

  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD08472-01-5
 S. 4741                             2

 
   3.  DEFRAUD  INDIVIDUALS,  INCLUDING  TWO  OR  MORE VULNERABLE ELDERLY
 PERSONS; OR
  4.  DISPOSE  OF  SOLID  WASTE ON THE PROPERTY OF OTHERS, CAUSING DAMAGE
 EXCEEDING ONE THOUSAND DOLLARS.
   SCHEME TO DEFRAUD IN THE FOURTH DEGREE IS A CLASS E FELONY.
 § 190.64 SCHEME TO DEFRAUD IN THE THIRD DEGREE.
   A PERSON IS GUILTY OF SCHEME TO DEFRAUD IN THE THIRD DEGREE WHEN THEY:
   1. ENGAGE IN SUCH CONDUCT WITH INTENT TO DEFRAUD TWENTY-FIVE  OR  MORE
 PERSONS; OR
   2. OBTAIN PROPERTY EXCEEDING THREE THOUSAND DOLLARS IN VALUE; OR
   3.  DEFRAUD  INDIVIDUALS,  INCLUDING  TWO  OR  MORE VULNERABLE ELDERLY
 PERSONS, OBTAINING PROPERTY EXCEEDING ONE THOUSAND DOLLARS IN VALUE.
   SCHEME TO DEFRAUD IN THE THIRD DEGREE IS A CLASS D FELONY.
 § 190.66 SCHEME TO DEFRAUD IN THE SECOND DEGREE.
   A PERSON IS GUILTY OF SCHEME TO DEFRAUD  IN  THE  SECOND  DEGREE  WHEN
 THEY:
   1.  ENGAGE  IN SUCH CONDUCT WITH INTENT TO DEFRAUD ONE HUNDRED OR MORE
 PERSONS; OR
   2. OBTAIN PROPERTY EXCEEDING FIFTY THOUSAND DOLLARS IN VALUE; OR
   3. DEFRAUD INDIVIDUALS,  INCLUDING  TWO  OR  MORE  VULNERABLE  ELDERLY
 PERSONS, OBTAINING PROPERTY EXCEEDING THREE THOUSAND DOLLARS IN VALUE.
   SCHEME TO DEFRAUD IN THE SECOND DEGREE IS A CLASS C FELONY.
 § 190.68 SCHEME TO DEFRAUD IN THE FIRST DEGREE.
   A PERSON IS GUILTY OF SCHEME TO DEFRAUD IN THE FIRST DEGREE WHEN THEY:
   1.  ENGAGE IN SUCH CONDUCT WITH INTENT TO DEFRAUD ONE THOUSAND OR MORE
 PERSONS; OR
   2. OBTAIN PROPERTY EXCEEDING ONE MILLION DOLLARS IN VALUE; OR
   3. DEFRAUD INDIVIDUALS,  INCLUDING  TWO  OR  MORE  VULNERABLE  ELDERLY
 PERSONS, OBTAINING PROPERTY EXCEEDING FIFTY THOUSAND DOLLARS IN VALUE.
   SCHEME TO DEFRAUD IN THE FIRST DEGREE IS A CLASS B FELONY.
   §  3.  Subdivision  2  of section 496.06 of the penal law, as added by
 section 14 of subpart A of part H of chapter 55 of the laws of 2014,  is
 amended to read as follows:
   2. A "specified offense" is an offense defined by any of the following
 provisions  of  this  chapter:  section  155.25 (petit larceny); section
 155.30 (grand larceny in  the  fourth  degree);  section  155.35  (grand
 larceny  in  the  third  degree);  section  155.40 (grand larceny in the
 second degree); section 155.42 (grand  larceny  in  the  first  degree);
 section 190.60 (scheme to defraud in the [second] FIFTH degree); SECTION
 190.62  (SCHEME TO DEFRAUD IN THE FOURTH DEGREE); SECTION 190.64 (SCHEME
 TO DEFRAUD IN THE THIRD DEGREE); SECTION 190.66 (SCHEME  TO  DEFRAUD  IN
 THE SECOND DEGREE); or section [190.65] 190.68 (scheme to defraud in the
 first degree).
   §  4. Paragraph f of subdivision 1 of section 410 of the general busi-
 ness law, as amended by chapter 189 of the laws of 2018, is  amended  to
 read as follows:
   f.  Conviction  of any of the following crimes subsequent to the issu-
 ance of a license or registration pursuant to this article: fraud pursu-
 ant to sections 170.10, 170.15, 176.15, 176.20, 176.25, 176.30,  190.62,
 190.64, 190.66 and [190.65] 190.68; falsifying business records pursuant
 to section 175.10; grand larceny pursuant to article 155; bribery pursu-
 ant  to sections 180.03, 180.08, 180.15, 180.25, 200.00, 200.03, 200.04,
 200.10, 200.11, 200.12, 200.45, 200.50;  perjury  pursuant  to  sections
 210.10,  210.15,  210.40;  assault  pursuant to sections 120.05, 120.10,
 120.11, 120.12; robbery pursuant to article 160;  homicide  pursuant  to
 sections 125.25 and 125.27; manslaughter pursuant to sections 125.15 and
 S. 4741                             3
 
 125.20;  kidnapping  and  unlawful  imprisonment  pursuant  to  sections
 135.10, 135.20 and  135.25;  unlawful  weapons  possession  pursuant  to
 sections 265.02, 265.03 and 265.04; criminal use of a weapon pursuant to
 sections  265.08  and  265.09;  criminal  sale  of  a weapon pursuant to
 sections 265.11 and 265.12; compelling prostitution pursuant to  section
 230.33; sex trafficking pursuant to section 230.34; sex trafficking of a
 child pursuant to section 230.34-a; and sex offenses pursuant to article
 130  of  the penal law. Provided, however, that for the purposes of this
 article, none of the following shall be considered criminal  convictions
 or  reported as such: (i) a conviction for which an executive pardon has
 been issued pursuant to the executive law; (ii) a conviction  which  has
 been  vacated  and  replaced  by a youthful offender finding pursuant to
 article seven hundred twenty of  the  criminal  procedure  law,  or  the
 applicable  provisions  of  law  of  any  other jurisdiction; or (iii) a
 conviction the records of which have been expunged or sealed pursuant to
 the applicable provisions of the laws of this  state  or  of  any  other
 jurisdiction; and (iv) a conviction for which other evidence of success-
 ful rehabilitation to remove the disability has been issued.
   §  5. Clause (ii) of subparagraph 2 of paragraph b of subdivision 3 of
 section 220-b of the labor law, as amended by chapter 7 of the  laws  of
 2008, is amended to read as follows:
   (ii)  coercion in the first degree as defined in section 135.65 of the
 penal law, grand larceny in the fourth  degree  as  defined  in  section
 155.30 of the penal law, grand larceny in the third degree as defined in
 section  155.35  of the penal law, grand larceny in the second degree as
 defined in section 155.40 of the penal law, grand larceny in  the  first
 degree  as  defined  in  section 155.42 of the penal law, forgery in the
 second degree as defined in section 170.10 of the penal law, forgery  in
 the first degree as defined in section 170.15 of the penal law, criminal
 possession  of  a  forged  instrument in the second degree as defined in
 section 170.25 of the penal law, criminal possession of a forged instru-
 ment in the first degree as defined in section 170.30 of the penal  law,
 criminal  possession  of forgery devices as defined in section 170.40 of
 the penal law, falsifying  business  records  in  the  first  degree  as
 defined  in  section  175.10  of  the  penal  law, tampering with public
 records in the first degree as defined in section 175.25  of  the  penal
 law,  offering  a  false  instrument  for  filing in the first degree as
 defined in section 175.35 of the penal law, issuing a false  certificate
 as  defined  in  section 175.40 of the penal law, insurance fraud in the
 fourth degree as defined in section 176.15 of the penal  law,  insurance
 fraud in the third degree as defined in section 176.20 of the penal law,
 insurance fraud in the second degree as defined in section 176.25 of the
 penal  law,  insurance  fraud  in the first degree as defined in section
 176.30 of the penal  law,  aggravated  insurance  fraud  as  defined  in
 section  176.35 of the penal law, commercial bribing in the first degree
 as defined in section 180.03 of the penal law, commercial bribe  receiv-
 ing  in  the first degree as defined in section 180.08 of the penal law,
 bribing a labor official as defined in section 180.15 of the penal  law,
 bribe  receiving by a labor official as defined in section 180.25 of the
 penal law, criminal impersonation in the second  degree  as  defined  in
 section  190.25  of  the  penal law, criminal impersonation in the first
 degree as defined in section 190.26 of the penal law, criminal usury  in
 the  second degree as defined in section 190.40 of the penal law, crimi-
 nal usury in the first degree as defined in section 190.42 of the  penal
 law,  scheme  to  defraud  in  the  first  degree  as defined in section
 [190.65] 190.68 of the penal law, bribery in the third degree as defined
 S. 4741                             4
 
 in section 200.00 of the penal law, bribery  in  the  second  degree  as
 defined  in section 200.03 of the penal law, bribery in the first degree
 as defined in section 200.04 of the penal law, bribe  receiving  in  the
 third  degree  as  defined  in  section  200.10  of the penal law, bribe
 receiving in the second degree as defined in section 200.11 of the penal
 law, bribe receiving in the first degree as defined in section 200.12 of
 the penal law, rewarding official misconduct in  the  second  degree  as
 defined  in  section 200.20 of the penal law, rewarding official miscon-
 duct in the first degree as defined in section 200.22 of the penal  law,
 bribe giving for public office as defined in section 200.45 of the penal
 law,  or  the  attempted  commission of any of the offenses set forth in
 this paragraph, provided that such offense constitutes a felony; or
   § 6. Paragraph (a) of subdivision 1 of section  460.10  of  the  penal
 law,  as  amended by chapter 134 of the laws of 2019, is amended to read
 as follows:
   (a) Any of the felonies set forth in this  chapter:  sections  120.05,
 120.10 and 120.11 relating to assault; sections 121.12 and 121.13 relat-
 ing  to  strangulation;  sections 125.10 to 125.27 relating to homicide;
 sections 130.25, 130.30 and 130.35 relating to rape; sections 135.20 and
 135.25 relating to kidnapping; sections 135.35 and  135.37  relating  to
 labor trafficking; section 135.65 relating to coercion; sections 140.20,
 140.25  and  140.30  relating  to  burglary; sections 145.05, 145.10 and
 145.12 relating to criminal mischief; article one hundred fifty relating
 to arson; sections 155.30, 155.35, 155.40 and 155.42 relating  to  grand
 larceny;  sections  177.10, 177.15, 177.20 and 177.25 relating to health
 care fraud; article one hundred  sixty  relating  to  robbery;  sections
 165.45,  165.50,  165.52  and  165.54 relating to criminal possession of
 stolen property; sections 165.72 and 165.73 relating to trademark  coun-
 terfeiting;  sections 170.10, 170.15, 170.25, 170.30, 170.40, 170.65 and
 170.70 relating to forgery; sections 175.10, 175.25, 175.35, 175.40  and
 210.40 relating to false statements; sections 176.15, 176.20, 176.25 and
 176.30  relating to insurance fraud; sections 178.20 and 178.25 relating
 to criminal diversion of  prescription  medications  and  prescriptions;
 sections 180.03, 180.08, 180.15, 180.25, 180.40, 180.45, 200.00, 200.03,
 200.04,  200.10, 200.11, 200.12, 200.20, 200.22, 200.25, 200.27, 200.56,
 215.00, 215.05 and 215.19 relating to bribery; sections 187.10,  187.15,
 187.20  and  187.25  relating  to  residential  mortgage fraud, sections
 190.40 and 190.42 relating to criminal usury; [section 190.65]  SECTIONS
 190.62,  190.64,  190.66  AND 190.68 relating to schemes to defraud; any
 felony defined in article four hundred ninety-six; sections  205.60  and
 205.65  relating  to hindering prosecution; sections 210.10, 210.15, and
 215.51 relating to perjury and  contempt;  section  215.40  relating  to
 tampering  with  physical  evidence;  sections  220.06,  220.09, 220.16,
 220.18, 220.21, 220.31, 220.34, 220.39, 220.41, 220.43, 220.46,  220.55,
 220.60,  220.65  and  220.77 relating to controlled substances; sections
 225.10 and 225.20 relating to gambling;  sections  230.25,  230.30,  and
 230.32  relating  to  promoting prostitution; section 230.34 relating to
 sex trafficking; section 230.34-a  relating  to  sex  trafficking  of  a
 child; sections 235.06, 235.07, 235.21 and 235.22 relating to obscenity;
 sections 263.10 and 263.15 relating to promoting a sexual performance by
 a child; sections 265.02, 265.03, 265.04, 265.11, 265.12, 265.13 and the
 provisions  of  section  265.10  which  constitute  a felony relating to
 firearms and other dangerous weapons; sections 265.14 and 265.16  relat-
 ing to criminal sale of a firearm; section 265.50 relating to the crimi-
 nal  manufacture, sale or transport of an undetectable firearm, rifle or
 shotgun; section 275.10, 275.20, 275.30, or 275.40 relating to unauthor-
 S. 4741                             5
 
 ized recordings; and sections 470.05, 470.10, 470.15 and 470.20 relating
 to money laundering; or
   § 7. Paragraph (d) of subdivision 2 of section 155.05 of the penal law
 is amended to read as follows:
   (d) By false promise.
   (I)  A  person  obtains  property by false promise when, pursuant to a
 scheme to defraud, [he] SUCH PERSON obtains property of another by means
 of a representation, express or implied, that  [he]  SUCH  PERSON  or  a
 third person will [in the future] engage in [particular] FUTURE conduct,
 [and  when  he does not intend to engage in such conduct or, as the case
 may be, does not believe that the third person intends] WHILE  INTENDING
 NOT to engage in such conduct.
   [In  any  prosecution  for  larceny  based  upon  a false promise, the
 defendant's intention or belief that the promise would not be  performed
 may  not  be  established  by  or inferred from the fact alone that such
 promise was not performed.  Such  a  finding  may  be  based  only  upon
 evidence  establishing  that the facts and circumstances of the case are
 wholly consistent with guilty intent or belief and  wholly  inconsistent
 with innocent intent or belief, and excluding to a moral certainty every
 hypothesis  except  that of the defendant's intention or belief that the
 promise would not be performed;]
   (II) IN CASES  INVOLVING  LAWYERS  OBTAINING  PROPERTY  FROM  MULTIPLE
 CLIENTS,  PROPERTY OBTAINED FROM MULTIPLE CLIENTS ACROSS COUNTIES MAY BE
 AGGREGATED INTO A SINGLE LARCENY COUNT.
   (III) THE DEFENDANT'S INTENTION NOT TO PERFORM  THE  PROMISE  MUST  BE
 PROVEN  BY  EVIDENCE  WHOLLY CONSISTENT WITH GUILTY INTENT AND EXCLUDING
 ALL INNOCENT EXPLANATIONS.
   § 8. Title N of the penal law is amended by adding a new  article  243
 to read as follows:
                                ARTICLE 243
                   HARASSMENT OF LEGAL SERVICES CLIENTS
 SECTION 243.00 HARASSMENT  OF  A  LEGAL  SERVICES  CLIENT  IN THE SECOND
                  DEGREE.
         243.05 HARASSMENT OF  A  LEGAL  SERVICES  CLIENT  IN  THE  FIRST
                  DEGREE.
 § 243.00 HARASSMENT OF A LEGAL SERVICES CLIENT IN THE SECOND DEGREE.
   A  LAWYER  IS  GUILTY  OF HARASSMENT OF A LEGAL SERVICES CLIENT IN THE
 SECOND DEGREE WHEN, WITH INTENT TO INDUCE A CLIENT TO RETAIN SERVICES OR
 PAY UNREASONABLE FEES, SUCH LAWYER INTENTIONALLY:
   1. FAILS TO RETURN THE CLIENT'S DOCUMENTS UPON REQUEST; OR
   2. FAILS TO RETURN UNUSED FUNDS FROM A RETAINER UPON REQUEST.
   HARASSMENT OF A LEGAL SERVICES CLIENT IN THE SECOND DEGREE IS A  CLASS
 A MISDEMEANOR.
 § 243.05 HARASSMENT OF A LEGAL SERVICES CLIENT IN THE FIRST DEGREE.
   A  LAWYER  IS  GUILTY  OF HARASSMENT OF A LEGAL SERVICES CLIENT IN THE
 FIRST DEGREE WHEN, WITH INTENT TO INDUCE A CLIENT TO RETAIN SERVICES  OR
 PAY UNREASONABLE FEES, SUCH LAWYER THREATENS, EXPRESSLY OR IMPLIEDLY, TO
 REVEAL  CONFIDENTIAL  INFORMATION,  INCLUDING  BUT  NOT  LIMITED  TO THE
 CLIENT'S IMMIGRATION STATUS.
   HARASSMENT OF A LEGAL SERVICES CLIENT IN THE FIRST DEGREE IS A CLASS E
 FELONY.
   § 9. Severability. If any clause, sentence, paragraph, section or part
 of this act shall be adjudged by any court of competent jurisdiction  to
 be  invalid  and  after  exhaustion  of all further judicial review, the
 judgment shall not affect, impair or invalidate the  remainder  thereof,
 but  shall  be  confined in its operation to the clause, sentence, para-
 S. 4741                             6
 
 graph, section or part of this act directly involved in the  controversy
 in which the judgment shall have been rendered.
   § 10. This act shall take effect on the first of January next succeed-
 ing the date on which it shall have become a law.

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