STATE OF NEW YORK
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4579
2025-2026 Regular Sessions
IN SENATE
February 7, 2025
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Introduced by Sens. HOYLMAN-SIGAL, JACKSON -- read twice and ordered
printed, and when printed to be committed to the Committee on Banks
AN ACT to amend the banking law, in relation to prohibiting bank invest-
ments in bad faith landlords
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The banking law is amended by adding a new section 13 to
2 read as follows:
3 § 13. Investments in bad faith landlords by state chartered banking
4 institutions. 1. No state chartered banking institution shall provide
5 financing for or invest in the stocks, securities, or other obligations
6 of any person, institution, company, or subsidiary engaged in the busi-
7 ness of leasing residential real estate that has:
8 (a) Been convicted of engaging in illegal conduct against a tenant,
9 including (i) harassment, (ii) coercion, or (iii) fraud;
10 (b) Been convicted of fraudulent refinancing of loans, tax fraud,
11 embezzlement, or other fraud or theft related to financial management;
12 or
13 (c) Entered into a consent decree with the office of the attorney
14 general in settlement of a lawsuit regarding unfair or deceptive prac-
15 tices against a tenant, that (i) establishes a tenant restitution fund,
16 pursuant to subdivision twelve of section sixty-three of the executive
17 law, with total contributions in excess of one million dollars, (ii)
18 results in an independent property management company acquiring the
19 primary management responsibilities of any of the respondent's proper-
20 ties, or (iii) requires a monitor to engage in the review of the
21 respondent's compliance with the policies and provisions of such a
22 decree.
23 2. For purposes of this section:
24 (a) "State chartered banking institution" shall have the same meaning
25 as defined in subdivision one of section twelve-a of this article;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD04008-01-5
S. 4579 2
1 (b) "Consent decree" shall mean an agreement between the parties in an
2 action to resolve the action, which is entered, approved, and ordered by
3 a court;
4 (c) "Tenant restitution fund" shall mean a fund, trust, or account in
5 which money is deposited for the benefit of potential claimants who
6 qualify for restitutions under the court action that led to the creation
7 of the tenant restitution fund and the office of the attorney general
8 shall have oversight of the fund and be responsible for making distrib-
9 utions to claimants;
10 (d) "Property management company" shall mean a company that is not
11 owned by a party to the consent decree that is qualified to manage the
12 properties that are subject to a consent decree; and
13 (e) "Monitor" shall mean an individual who has been approved by the
14 office of the attorney general to review and report on whether the other
15 party to the consent decree and/or the property management company
16 comply with the policies and provisions of the consent decree.
17 § 2. This act shall take effect immediately and shall apply to all
18 contracts entered into, renewed, modified or amended on or after such
19 effective date.
