Provides that a banking institution may claim the right of set off against a deposit account if notice of the set off together with the reasons for the set off are mailed to the depositor prior to such action; provides that failure to provide such notice shall result in the forfeiture of the right of set off against the depositor.
STATE OF NEW YORK
________________________________________________________________________
3014
2011-2012 Regular Sessions
IN ASSEMBLY
January 21, 2011
___________
Introduced by M. of A. SCHROEDER, J. RIVERA, COOK -- Multi-Sponsored by
-- M. of A. JEFFRIES -- read once and referred to the Committee on
Banks
AN ACT to amend the banking law, in relation to the right of set off
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Subdivisions 2 and 3 of section 9-g of the banking law, as
2 added by chapter 10 of the laws of 1980, are amended to read as follows:
3 2. No banking institution shall assert, claim or exercise any right
4 of set off against any other deposit account held by such banking insti-
5 tution unless, prior to [or on the same business day of] such action,
6 notice of the set off together with the reasons for the set off are
7 mailed to the depositor.
8 3. Failure to provide the notice required by this section shall [not
9 be deemed to affect the validity] result in the forfeiture of the right
10 of set off which would have resulted had proper notice been provided.
11 § 2. This act shall take effect immediately.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD06769-01-1
