Relates to the prohibition of lending institutions issuing mail-loan checks except in response to an affirmative request or application therefor; provides that any debt, interest, fee or other obligation arising from a mail-loan check issued in violation of this section shall be null and void and unenforceable.
STATE OF NEW YORK
________________________________________________________________________
9404--A
2025-2026 Regular Sessions
IN ASSEMBLY
December 19, 2025
___________
Introduced by M. of A. SANTABARBARA -- read once and referred to the
Committee on Banks -- recommitted to the Committee on Banks in accord-
ance with Assembly Rule 3, sec. 2 -- committee discharged, bill
amended, ordered reprinted as amended and recommitted to said commit-
tee
AN ACT to amend the banking law, in relation to the prohibition of lend-
ing institutions issuing unsolicited mail-loan checks
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Legislative findings. The legislature finds that unsolicit-
2 ed "live loan checks" can mislead people into taking out loans they
3 never asked for. These checks often look like refunds or official
4 payments, but once deposited, they create a loan with high interest and
5 fees.
6 Many New Yorkers -- especially seniors, people with disabilities, and
7 families under financial stress -- are at risk of being harmed by this
8 practice.
9 The purpose of this act is to stop lenders from sending these unsolic-
10 ited checks and to protect consumers from accidentally entering into
11 unwanted loans.
12 § 2. Subdivision 3 of section 9-t of the banking law, as amended by
13 chapter 184 of the laws of 2022, is amended to read as follows:
14 3. (a) No lending institution shall issue a mail-loan check, except in
15 response to [a] an affirmative request or application therefor by the
16 person to whom it is issued.
17 (b) Issuance of a mail-loan check in response to such request or
18 application, or issuance of any replacement check, legitimate refund,
19 rebate, or government-issued check shall not constitute a violation of
20 paragraph (a) of this subdivision.
21 § 3. Section 9-t of the banking law is amended by adding two new
22 subdivisions 6 and 7 to read as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14226-02-6
A. 9404--A 2
1 6. Any debt, interest, fee or other obligation arising from a mail-
2 loan check issued in violation of this section shall be null and void
3 and unenforceable. No person, including any assignee or debt collector,
4 shall collect or attempt to collect such obligation, or report such
5 obligation to a credit reporting agency. Any amounts paid by a consumer
6 in connection with such obligation shall be refunded.
7 7. No lending institution shall, directly or indirectly, structure,
8 label or modify any mail-loan check or instrument, or use any device,
9 subterfuge or pretense, for the purpose of evading the requirements of
10 this section, including through the use of any affiliate, third-party
11 service provider, agent or arrangement.
12 § 4. This act shall take effect on the one hundred eightieth day after
13 it shall have become a law.
