A06655 Summary:

BILL NOA06655E
 
SAME ASNo Same As
 
SPONSORCarroll
 
COSPNSRAbbate, Stirpe, Reyes, DenDekker, Taylor, Cymbrowitz, Dickens, Miller MG, D'Urso, Englebright, Rosenthal D, Galef, Gottfried, Ramos, DeStefano, Mikulin, Smith, Sayegh, Williams, Cook, Abinanti, Quart, Seawright, LiPetri, Reilly, Miller B, Rozic, Palumbo, Epstein, Fernandez, Ryan, Steck, Cruz, Pheffer Amato, Pichardo, Raia, Ra, Benedetto, Byrne, Jacobson, Buchwald, Hyndman, Perry, Thiele, Solages, Lavine, Stern, Garbarino, Griffin, Jones, Buttenschon, Blake, Paulin, Braunstein, Fall, Frontus, Rosenthal L, Wallace, Dilan, Aubry, Mosley, Jean-Pierre, Walker, Darling, Ortiz
 
MLTSPNSRDe La Rosa, Fitzpatrick, Hevesi, Lawrence, Simon
 
Amd §415, V & T L; amd Gen Bus L, generally; amd §337, Pers Prop L
 
Requires registration of new automotive broker businesses; enacts various provisions relating to conduct of such businesses; defines certain deceptive practices; establishes rights of action and penalties.
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A06655 Actions:

BILL NOA06655E
 
03/14/2019referred to consumer affairs and protection
05/24/2019amend and recommit to consumer affairs and protection
05/24/2019print number 6655a
06/11/2019amend and recommit to consumer affairs and protection
06/11/2019print number 6655b
06/14/2019amend and recommit to consumer affairs and protection
06/14/2019print number 6655c
06/15/2019amend and recommit to consumer affairs and protection
06/15/2019print number 6655d
01/08/2020referred to consumer affairs and protection
02/24/2020amend (t) and recommit to consumer affairs and protection
02/24/2020print number 6655e
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A06655 Committee Votes:

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A06655 Floor Votes:

There are no votes for this bill in this legislative session.
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A06655 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         6655--E
 
                               2019-2020 Regular Sessions
 
                   IN ASSEMBLY
 
                                     March 14, 2019
                                       ___________
 
        Introduced  by  M.  of  A.  CARROLL,  ABBATE,  STIRPE, REYES, DenDEKKER,
          TAYLOR,  CYMBROWITZ,  DICKENS,  M. G. MILLER,   D'URSO,   ENGLEBRIGHT,
          D. ROSENTHAL,  GALEF,  GOTTFRIED,  RAMOS,  DeSTEFANO,  MIKULIN, SMITH,
          SAYEGH, WILLIAMS, COOK, ABINANTI, QUART, SEAWRIGHT,  LiPETRI,  REILLY,
          B. MILLER,  ROZIC,  PALUMBO,  EPSTEIN,  FERNANDEZ,  RYAN, STECK, CRUZ,
          PHEFFER AMATO, PICHARDO, RA,  BENEDETTO,  BYRNE,  JACOBSON,  BUCHWALD,
          HYNDMAN,  PERRY,  THIELE,  SOLAGES, LAVINE, STERN, GARBARINO, GRIFFIN,
          JONES,  BUTTENSCHON,  BLAKE,  PAULIN,   BRAUNSTEIN,   FALL,   FRONTUS,
          L. ROSENTHAL,  WALLACE  --  Multi-Sponsored by -- M. of A. DE LA ROSA,
          FITZPATRICK, HEVESI, LAWRENCE, SIMON -- read once and referred to  the
          Committee  on Consumer Affairs and Protection -- committee discharged,
          bill amended, ordered reprinted as amended  and  recommitted  to  said
          committee  --  again  reported  from  said  committee with amendments,
          ordered reprinted as amended and  recommitted  to  said  committee  --
          committee  discharged,  bill amended, ordered reprinted as amended and
          recommitted to said committee -- again reported  from  said  committee
          with  amendments, ordered reprinted as amended and recommitted to said
          committee -- recommitted to the  Committee  on  Consumer  Affairs  and
          Protection  in  accordance  with  Assembly Rule 3, sec. 2 -- committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to said committee
 
        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:
 
     1    Section  1.  Subdivision 1 of section 736 of the general business law,
     2  as amended by chapter 28 of the laws of  2018,  is  amended  and  a  new
     3  subdivision 4 is added to read as follows:
     4    1.  "Automobile  broker  business"  means  any  person who, for a fee,
     5  commission or other valuable consideration, regardless of  whether  such

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD08916-23-0

        A. 6655--E                          2
 
     1  fee, commission, or consideration is paid directly by a consumer, offers
     2  to  provide,  provides,  or  represents  that  he  or she will provide a
     3  service of purchasing, arranging, assisting, facilitating  or  effecting
     4  the purchase or lease of an automobile as agent, broker, or intermediary
     5  for a consumer. "Automobile broker business" does not include any person
     6  registered as a new motor vehicle dealer or qualified dealer pursuant to
     7  article sixteen of the vehicle and traffic law nor any bona fide employ-
     8  ee  of  a  registered new motor vehicle dealer or qualified dealer while
     9  acting for such new motor vehicle dealer or  qualified  dealer,  or  any
    10  person  who  sells, offers for sale or lease or acts as agent, broker or
    11  intermediary in effecting the purchase or lease of three or fewer  auto-
    12  mobiles  in  any  calendar  year,  any national service which aggregates
    13  information for consumers, but does  not  otherwise  have  contact  with
    14  consumers, [or] any motor vehicle franchisor, manufacturer, or distribu-
    15  tor,  distributor  branch  or  factory  branch  registered under article
    16  sixteen of the vehicle and traffic law.
    17    4. "New motor vehicle" shall have  the  same  meaning  as  defined  in
    18  subdivision  eleven of section four hundred sixty-two of the vehicle and
    19  traffic law.
    20    § 2. Section 736-a of the general business law, as  added  by  chapter
    21  477 of the laws of 2017, is amended to read as follows:
    22    § 736-a. Registration required. 1. (a) No person shall engage in busi-
    23  ness  as  an  automobile  broker  business,  as defined in section seven
    24  hundred thirty-six of this article, without first having been  issued  a
    25  certificate  of  registration for an automobile broker business pursuant
    26  to paragraph c of subdivision seven of section four hundred  fifteen  of
    27  the  vehicle and traffic law. A certificate of registration for an auto-
    28  mobile broker business shall be valid for a period of two years.
    29    (b) No automobile broker business shall represent  or  accept  payment
    30  from,  either  directly or indirectly, a franchisee, dealer, franchisor,
    31  manufacturer, distributor, distributor branch and/or factory branch,  as
    32  such terms are defined in sections four hundred fifteen and four hundred
    33  sixty-two of the vehicle and traffic law.
    34    (c) No automobile broker business shall perform any services involving
    35  the  purchasing,  arranging,  assisting,  facilitating  or effecting the
    36  purchase or lease of an automobile as agent, broker, or intermediary for
    37  a consumer, unless done pursuant to a contract that  complies  with  the
    38  provisions of section seven hundred thirty-eight of this article.
    39    2.  A  certificate  of  registration for an automobile broker business
    40  shall not permit the registrant to display for sale or lease any new  or
    41  used  motor vehicles without registration as a dealer under section four
    42  hundred fifteen of the vehicle and traffic law.
    43    3. Any person that sells or leases five or more vehicles in a calendar
    44  year to or through one or more automobile  broker  businesses  shall  be
    45  deemed to be dealing in motor vehicles as that term is used in paragraph
    46  a  of subdivision one of section four hundred fifteen of the vehicle and
    47  traffic law.
    48    4. The commissioner of motor vehicles  shall  adopt  rules  and  regu-
    49  lations  necessary to effectuate the provisions of this section, includ-
    50  ing regulations that require the disclosure of the  name,  address,  and
    51  registration  number  of an automobile broker business that provided the
    52  service of arranging, assisting, facilitating or effecting the  purchase
    53  or  lease  of any new motor vehicle, and the fee collected by the broker
    54  from the consumer for providing such service. Such rules and regulations
    55  shall require that such information of the  automobile  broker  business
    56  and  its  fee  for  service  be printed on any invoice, bill of sale, or

        A. 6655--E                          3
 
     1  buyer's order, and on any application for registration or title  submit-
     2  ted  by  any dealer to the department of motor vehicles on behalf of the
     3  consumer related to such purchased or leased motor vehicle.
     4    § 3. The general business law is amended by adding a new section 737-a
     5  to read as follows:
     6    §  737-a.  Bona  fide  bid  soliciting  required. 1. On behalf of each
     7  consumer executing a contract  that  conforms  to  the  requirements  of
     8  subdivision three of section seven hundred thirty-eight of this article,
     9  an  automobile  broker business shall solicit a bid, from at least three
    10  new motor vehicle dealers of the same line-make, that meets the specifi-
    11  cations of such prospective buyer or  lessee,  including  from  the  new
    12  motor vehicle dealer located in closest proximity to the home address of
    13  a  prospective buyer or lessee of a new motor vehicle or, in the case of
    14  an entity, the place of doing business  of  such  prospective  buyer  or
    15  lessee  of  a  new motor vehicle. Whenever an automobile broker business
    16  may choose bid specifications on behalf of a consumer,  such  automobile
    17  broker business shall solicit a bid matching such specifications from at
    18  least  three  new motor vehicle dealers of the same line-make, including
    19  from the new motor vehicle dealer located in closest  proximity  to  the
    20  home address of a prospective buyer or lessee of a new motor vehicle or,
    21  in  the  case of an entity, the place of doing business of such prospec-
    22  tive buyer or lessee of a new motor vehicle.
    23    2. At a minimum, an automobile broker business  that  solicits  a  bid
    24  pursuant  to subdivision one of this section shall request the following
    25  information as part of any solicitation to a new motor vehicle dealer:
    26    (a) price or lease costs;
    27    (b) down or similar payment;
    28    (c) number of payments;
    29    (d) amount of installment or monthly payments;
    30    (e) make, model, year of production, and color of any available  motor
    31  vehicle;
    32    (f)  whether  the motor vehicle has accessories specifically requested
    33  by the consumer;
    34    (g) fees;
    35    (h) where applicable, finance charges and/or annual percentage rate;
    36    (i) estimated delivery date of the automobile;
    37    (j) statement of whether or not the manufacturer's warranty accompany-
    38  ing the motor vehicle is the same warranty as that furnished to purchas-
    39  ers of that make motor vehicle from an authorized dealer; and
    40    (k) the identity of the new motor vehicle dealer offering a bid.
    41    3. The contents of each bid  by  a  motor  vehicle  dealer,  solicited
    42  pursuant  to  subdivision one of this section, shall be provided to each
    43  consumer on whose behalf such bid has been solicited, regardless of  the
    44  particulars or content of any such bid.
    45    4.  The  commissioner  of  motor  vehicles shall adopt rules and regu-
    46  lations necessary to effectuate the provisions of this section.
    47    § 4. The opening paragraph and paragraph  (e)  of  subdivision  1  and
    48  subdivisions  3  and  4  of section 738 of the general business law, the
    49  opening paragraph and paragraph (e) of  subdivision  1  as  amended  and
    50  subdivision 4 as added by chapter 28 of the laws of 2018 and subdivision
    51  3  as amended by chapter 477 of the laws of 2017, are amended to read as
    52  follows:
    53    Every contract between a consumer and an  automobile  broker  business
    54  for  the  purchase  of [an automobile] a motor vehicle, other than a new
    55  motor vehicle, shall be in writing, shall be dated,  shall  contain  the
    56  street  address  of  the automobile broker business and the consumer and

        A. 6655--E                          4
 
     1  shall be signed by the consumer and by the automobile  broker  business.
     2  Every  contract  shall  comply  with  the requirements set forth in this
     3  section and contain the following:
     4    (e)  A  description  of  any  other services and an itemization of the
     5  charges for each. Such description shall include disclosure of the auto-
     6  mobile dealer from which the automobile was purchased, as  well  as  all
     7  fees,  commissions  or other valuable [considerations paid by an automo-
     8  bile dealer] consideration owed by the consumer to the automobile broker
     9  business for selling, arranging, assisting or effecting the sale  of  an
    10  automobile  as  agent,  broker, or intermediary between the consumer and
    11  the automobile dealer.
    12    3. Every contract between a consumer and an automobile broker business
    13  for the service of arranging, assisting, facilitating or  effecting  the
    14  purchase  or  lease of a new motor vehicle shall be in writing, shall be
    15  dated, shall contain the street address of the automobile  broker  busi-
    16  ness  and  the  consumer, and shall be signed by the consumer and by the
    17  automobile broker business. Every such contract shall  comply  with  the
    18  requirements  set  forth  in  this  section  and  contain  the following
    19  provisions, which shall be printed in at least  twelve-point  bold  type
    20  and shall not be negated or superseded by any additional provision:
    21    (a)  A title, across the top of the document in at least sixteen-point
    22  bold type, of "Contract for Automobile  Brokering  Services  for  a  New
    23  Motor Vehicle".
    24    (b) A statement of whether a solicited new motor vehicle is or will be
    25  manufactured  in  accordance with United States safety and environmental
    26  specifications and is or will be certified by the manufacturer as  such;
    27  provided, if the new motor vehicle is not or will not be manufactured in
    28  accordance  with  United States safety and environmental specifications,
    29  and the consumer has retained the automobile broker business to  arrange
    30  for  the  modification  of the new motor vehicle to meet such specifica-
    31  tions, the name and street address of the modification  facility  and  a
    32  statement in immediate proximity to such information that the automobile
    33  broker business assumes full financial responsibility that the new motor
    34  vehicle  will  be properly modified to meet all United States safety and
    35  environmental specifications.
    36    (c) A statement that the consumer may cancel the contract for  automo-
    37  bile  brokering  services  for a new motor vehicle for any reason within
    38  three days of the execution of such contract and that the  consumer  has
    39  the right to a full refund within ten business days following receipt of
    40  the notice of cancellation.
    41    (d)  A  statement  that,  if the requested new motor vehicle cannot be
    42  procured by the automobile broker business within thirty days  following
    43  the  date of execution of the contract for automobile brokering services
    44  for a new motor vehicle, the  consumer  has  the  right  to  cancel  the
    45  contract and to receive a full refund within ten business days following
    46  receipt  of  the  request  for a refund, unless the delay in delivery is
    47  attributable to the consumer.
    48    (e) A statement that the consumer shall be provided with the  contents
    49  of  each  bid  received by the automobile broker business in response to
    50  its solicitation on behalf of such consumer.
    51    (f) The amount of the fee to be paid by the consumer to the automobile
    52  broker business for the service of arranging, assisting, facilitating or
    53  effecting the purchase or lease of a new motor vehicle.
    54    (g) A statement that the single fee authorized by  such  contract  for
    55  automobile  brokering  services  for a new motor vehicle is inclusive of
    56  all charges incident to the purchasing, arranging, assisting, facilitat-

        A. 6655--E                          5
 
     1  ing or effecting the purchase or lease of such new motor vehicle by  the
     2  automobile broker business as agent, broker, or intermediary and that no
     3  other charge or expense whatsoever shall be taken, received, reserved or
     4  contracted for by the automobile broker business for such services.
     5    4.  The  contract  for  automobile  brokering services for a new motor
     6  vehicle shall be accompanied by a completed form in duplicate, captioned
     7  "Notice of Cancellation" which shall be attached  to  the  contract  and
     8  easily detachable, and which shall contain in at least twelve-point type
     9  the following:
    10    "Notice  of  Cancellation  You may cancel this Contract for Automobile
    11  Brokering Services for a New Motor Vehicle, without any penalty or obli-
    12  gation, within three days from the date  that  a  copy  of  an  executed
    13  contract  is received by you. You may also cancel this contract, without
    14  penalty or obligation,  if  the  automobile  broker  business  does  not
    15  produce a bid meeting your specifications within thirty days of the date
    16  of execution of this contract.
    17    To  cancel  this  contract, mail or deliver a signed and dated copy of
    18  this cancellation notice, or any other written notice, to (name of auto-
    19  mobile broker business) at (address of automobile broker  business)  not
    20  later  than  midnight of the third day, or, in the case of an automobile
    21  broker business not producing a bid meeting your  specifications  within
    22  thirty  days,  not  later  than midnight of the thirtieth day, following
    23  your receipt of a signed contract.
    24    I hereby cancel this transaction.
    25    ________________________________  (signature of consumer)
    26    _____________________  (date)"
    27    5. An automobile broker business shall deliver to the consumer or mail
    28  to him or her at the address shown on [the]  any  contract  required  by
    29  this section , an executed copy thereof.
    30    [4. An] 6. In addition to the brokering services agreement required by
    31  subdivision  one  of  this section, an automobile broker business in any
    32  transaction involving the lease of a vehicle shall  provide  the  retail
    33  lessee  with  a  retail lease agreement as provided for in section three
    34  hundred thirty-seven of the personal property law. The automobile broker
    35  shall provide a written disclosure of the amount of any fee,  commission
    36  or  other consideration paid or expected to be paid by the lessor to the
    37  automobile broker business in connection with  a  transaction  involving
    38  the  lease  of  a vehicle. Such disclosure shall be signed by the retail
    39  lessee. The automobile broker business shall provide the  retail  lessee
    40  with  a  signed  copy  of such disclosure together with the retail lease
    41  agreement referenced herein. Nothing in this section shall be  construed
    42  to  permit  the  delivery of an executed retail lease agreement to a new
    43  motor vehicle by a person other than the prospective lessee.
    44    § 5. Subdivision 1 of section 740-a of the general  business  law,  as
    45  amended  by  chapter  477  of  the  laws  of 2017, is amended to read as
    46  follows:
    47    1. Automobile broker businesses shall obtain and continue in effect  a
    48  surety  bond  in  an  amount of [one] two hundred fifty thousand dollars
    49  executed by a surety company authorized  to  transact  business  in  the
    50  state  by  the  department  of  financial  services  of the state or its
    51  successor. The bonds shall be approved as to form by  the  secretary  of
    52  state  and  shall  be  conditioned  on  the  automobile broker business'
    53  payment of all valid  bank  drafts,  including  checks,  drawn  for  the
    54  purchase  of  motor  vehicles  and  safekeeping of all customer deposits
    55  related to the sale of a motor vehicle between the time  of  receipt  of

        A. 6655--E                          6
 
     1  such  customer  deposit and the transfer of good title to the vehicle to
     2  the customer.
     3    §  6. Section 741 of the general business law, as added by chapter 616
     4  of the laws of 1988, is amended to read as follows:
     5    § 741. Deceptive acts and frauds prohibited. 1. It is hereby  declared
     6  to  be  a deceptive trade practice and unlawful for an automobile broker
     7  business to misrepresent directly  or  indirectly  in  its  advertising,
     8  promotional materials, sales presentation, or in any manner:
     9    [1.]  (a)  The nature of the services to be performed and that a third
    10  party will be paying for any such services;
    11    [2.] (b) The time within which the services will be performed;
    12    [3.] (c) The cost of the services to be performed; [and
    13    4.] (d) The ability of the automobile broker business to  perform  the
    14  services; and
    15    (e)  That  the  automobile  broker business is affiliated with any new
    16  motor  vehicle  manufacturer,  distributor,  distributor  branch  and/or
    17  factory  branch including the use of any trademarks or copyrighted mate-
    18  rial without the express, written consent of the owner of such material.
    19    2. It shall be a fraudulent business practice for an automobile broker
    20  business to refuse to disclose its registration number, issued either by
    21  the department of  motor  vehicles  pursuant  to  section  four  hundred
    22  fifteen  of  the  vehicle  and traffic law or a municipality, to a motor
    23  vehicle dealer. Furthermore, it shall be a fraudulent business  practice
    24  for  an  automobile  broker  business to make any misrepresentation to a
    25  motor vehicle dealer or new motor vehicle dealer regarding the eligibil-
    26  ity of any  consumer  for  any  discounts,  reductions  or  any  benefit
    27  programs regarding the sale or lease of a motor vehicle.
    28    3. It shall be a fraudulent business practice for an automobile broker
    29  business  to advertise new motor vehicles, through any print, electronic
    30  or digital signal or  medium,  written  or  verbal  statement  or  word,
    31  design,  device,  sound or any combination of any such method or medium,
    32  without disclosing that it is not a licensed motor vehicle dealer and is
    33  not an authorized satellite location for any particular  licensed  motor
    34  vehicle dealer.
    35    4. It shall be a fraudulent business practice for an automobile broker
    36  business to advertise through any print, electronic or digital signal or
    37  medium,  written  or  verbal statement or word, design, device, sound or
    38  any combination of any such method or medium, that would lead a  reason-
    39  able  consumer  to  conclude  that  the  automobile broker business is a
    40  licensed new motor vehicle dealer.
    41    5. It shall be a fraudulent business practice for an automobile broker
    42  business to maintain any website without including a text box  with  the
    43  following  statement in no less than eighteen-point boldface type on the
    44  splash page:  "(Broker name) is not a licensed new motor vehicle  dealer
    45  in  the  State  of  New  York,  nor is it an authorized affiliate of any
    46  licensed new motor vehicle dealer in the State of New York".
    47    6. It shall be a fraudulent business practice for an automobile broker
    48  business to include any pricing or financing offers or promotions in any
    49  advertisement, including any print,  electronic  or  digital  signal  or
    50  medium,  written  or  verbal statement or word, design, device, sound or
    51  any combination of any such method or medium.
    52    7. It shall be a fraudulent business practice for an automobile broker
    53  business to gain access to or use, or represent or advertise that it may
    54  access or use, a portal, computer,  or  internet  account  owned  by  or
    55  reserved  for  a  new  motor vehicle dealer to access or use one or more

        A. 6655--E                          7
 
     1  finance sources that  provide  automotive-related  loans,  or  purchases
     2  retail installment contracts or lease contracts for motor vehicles.
     3    § 7. Section 741-b of the general business law, as added by chapter 28
     4  of the laws of 2018, is amended to read as follows:
     5    § 741-b. [Disclosure]  Disclosures  required by brokers. 1. An automo-
     6  bile broker business shall generate and provide a disclosure at the time
     7  such automobile broker business takes an order to search for a leased or
     8  purchased vehicle meeting the prospective buyer or  lessee's  specifica-
     9  tions. Such disclosure shall provide the amount of any fees, commissions
    10  or  other  valuable consideration the automobile broker business expects
    11  to receive, if known, from [a dealer, lessor or] any [other]  person  or
    12  entity  for  any  assistance  the automobile broker business provides in
    13  effecting the purchase or lease transaction. If the amount of  any  such
    14  fees,  commissions or other valuable consideration the automobile broker
    15  business expects to receive is unknown  at  the  time  of  the  required
    16  disclosure, the automobile broker business shall disclose[: (a)] whether
    17  it  has a contract with any dealer, lessor or any other person or entity
    18  for the provision of assistance in effecting a purchase or lease  trans-
    19  action[;  and  (b) whether the automobile broker business may be compen-
    20  sated by the dealer, lessor or  any  other  person  or  entity  for  any
    21  assistance  in effecting such lease transaction]. Nothing in this subdi-
    22  vision shall be construed to permit the payment of any fees, commissions
    23  or other valuable consideration to an automobile broker business by  any
    24  motor vehicle dealer.
    25    2.  An  automobile broker business shall generate and provide an addi-
    26  tional disclosure to the consumer at the  time  such  automobile  broker
    27  business  takes  an  order  to  search  for  a motor vehicle meeting the
    28  prospective buyer or lessee's specifications. Such additional disclosure
    29  shall state the following:
    30    (a) that the automobile broker business shall make a bona fide attempt
    31  to obtain a bid, quote or offer from at least three unaffiliated dealers
    32  on behalf of the prospective buyer or lessee for a motor vehicle meeting
    33  the prospective buyer or lessee's specifications, including from the new
    34  motor vehicle dealer of such line-make located closest to  the  home  or
    35  place  of business of such prospective buyer for a consumer that seeks a
    36  new motor vehicle;
    37    (b) that the automobile broker business shall provide to the  consumer
    38  all  contents  of each bid made by a motor vehicle dealer in response to
    39  the solicitation of the automobile broker business; and
    40    (c) that the automobile broker business has a  duty  to  act  for  the
    41  benefit of the prospective buyer or lessee.
    42    3.  Each  disclosure required by this section to be made to a consumer
    43  shall be acknowledged in writing by each consumer.
    44    4. Prior to the execution of any purchase contract  or  lease  for  an
    45  automobile,  an  automobile  broker business shall provide each consumer
    46  with all disclosures required to be made by a dealer.
    47    § 8. The general business law is amended by adding a new section 741-c
    48  to read as follows:
    49    § 741-c. Private information security. 1. An automobile  broker  busi-
    50  ness  shall  report  annually  to  the  department of motor vehicles its
    51  compliance with sections three  hundred  ninety-nine-cc,  three  hundred
    52  ninety-nine-dd,  three  hundred  ninety-nine-ddd,  three hundred ninety-
    53  nine-h, three hundred ninety-nine-oo, three hundred ninety-nine-p, three
    54  hundred ninety-nine-pp, and eight hundred ninety-nine-bb of  this  chap-
    55  ter.  For the purposes of subdivision two of section eight hundred nine-

        A. 6655--E                          8
 
     1  ty-nine-bb of this chapter, an automobile broker business shall  not  be
     2  considered a small business as that term is defined in that section.
     3    2. In addition to the requirements of subdivision one of this section,
     4  an automobile broker business shall:
     5    (a) keep and maintain all consumer records containing private informa-
     6  tion  in  a safe place that is not accessible to persons not employed by
     7  the automobile broker business, including by keeping and  maintaining  a
     8  clear and permanent physical barrier from other businesses that share or
     9  neighbor its place of business;
    10    (b)  have  a  mailbox  at such place of business dedicated only to the
    11  automobile broker business; and
    12    (c) have a method of locking security items, including a locking cabi-
    13  net or safe.
    14    3. No transaction for the purchase or lease of a  previously  unregis-
    15  tered motor vehicle that was arranged, assisted, facilitated or effected
    16  by  an  automobile  broker  business  shall be valid unless the consumer
    17  personally delivers an executed purchase contract or lease,  and,  where
    18  applicable,  financing agreement, to the place of business of the dealer
    19  from which such vehicle will be purchased  or  leased  and  such  dealer
    20  verifies the identity of such consumer.
    21    §  9.  Section  743 of the general business law, as amended by chapter
    22  372 of the laws of 2016, is amended to read as follows:
    23    § 743. Enforcement [by]. 1. By attorney general. In  addition  to  the
    24  other  remedies  provided,  whenever  there shall be a violation of this
    25  article, application may be made by the attorney general in the name  of
    26  the  people of the state of New York to a court or justice having juris-
    27  diction by a special proceeding to issue an injunction, and upon  notice
    28  to  the defendant of not less than five days, to enjoin and restrain the
    29  continuance of such violations; and if it shall appear to the  satisfac-
    30  tion  of  the court or justice that the defendant has, in fact, violated
    31  this article, an injunction may be issued  by  such  court  or  justice,
    32  enjoining and restraining any further violation, without requiring proof
    33  that  any  person  has, in fact, been injured or damaged thereby. In any
    34  such proceeding, the court may make allowances to the  attorney  general
    35  as  provided in paragraph six of subdivision (a) of section eighty-three
    36  hundred three of the civil practice law and rules, and  direct  restitu-
    37  tion.  Whenever the court shall determine that a violation of this arti-
    38  cle has occurred, the court shall impose a civil  penalty  of  not  less
    39  than  [one] four thousand dollars and not more than [three] ten thousand
    40  dollars for each violation.  In connection with any such proposed appli-
    41  cation, the attorney general is authorized to  take  proof  and  make  a
    42  determination of the relevant facts and to issue subpoenas in accordance
    43  with the civil practice law and rules.
    44    2.  By  local  authorities.  (a) Municipalities may, pursuant to local
    45  law, act upon the business activity that is the subject of this article,
    46  provided that no  local  government  may  diminish  the  protections  or
    47  requirements of this article or prevent enforcement of its provisions by
    48  appropriate state officials.
    49    (b)  The provisions of this article may be enforced in the same manner
    50  as set forth in subdivision one of this section by  the  director  of  a
    51  municipal consumer affairs office or a business integrity commission, or
    52  by the town attorney, city corporation counsel, or other lawfully desig-
    53  nated enforcement officer of a municipality or local government, and all
    54  monies  collected  thereunder  shall be retained by such municipality or
    55  local government, provided that no local government may prevent enforce-
    56  ment of its provisions by appropriate state officials.

        A. 6655--E                          9
 
     1    3. By private party. Any persons that are or may  be  injured  by  any
     2  violation  of  this  article  may bring an action in his or her own name
     3  against an automobile broker business to enjoin  such  unlawful  act  or
     4  practice,  an action to recover his or her damages and statutory damages
     5  of  not  less  than four thousand dollars and not more than ten thousand
     6  dollars for each violation, or both such actions. Injury shall  include,
     7  but  not  be  limited  to,  lost sales on account of deceptive or unfair
     8  advertising and depriving a new motor vehicle dealer located closest  to
     9  a  lessee  or purchaser the opportunity to bid on such lease or purchase
    10  as entitled by this article. Damages shall include, but not  be  limited
    11  to,  lost  sales and the value of incentive payments, bonuses, holdbacks
    12  or similar payments that would  have  been  realized  had  a  lessee  or
    13  purchaser  purchased  or  leased such vehicle from the new motor vehicle
    14  dealer in closest proximity to such lessee  or  purchaser  but  for  the
    15  actions  of a person who knowingly aided the violation of the provisions
    16  of this article. Nothing in this section  shall  require  a  franchisor,
    17  manufacturer, or distributor to grant a new motor vehicle dealer a bene-
    18  fit  under an incentive, bonus, holdback or similar payment that the new
    19  motor vehicle dealer did not earn or for which  the  new  motor  vehicle
    20  dealer  did not complete or qualify. Such actions may be brought regard-
    21  less of whether or not the underlying violation is consumer-oriented  or
    22  has  a  public  impact.  Given  the remedial nature of this subdivision,
    23  standing to bring an action under this subdivision  shall  be  liberally
    24  construed and shall be available to the fullest extent otherwise permit-
    25  ted  by  law.  The court may, in its discretion, award treble damages if
    26  the court finds the defendant willfully or knowingly violated this arti-
    27  cle. The court shall award reasonable attorney's fees  and  costs  to  a
    28  prevailing plaintiff.
    29    §  10.  Paragraph a of subdivision 1 of section 415 of the vehicle and
    30  traffic law, as amended by chapter 554 of the laws of 2015,  is  amended
    31  to read as follows:
    32    a.  "Dealer" means a person engaged in the business of buying, selling
    33  or dealing in motor vehicles, motorcycles or trailers, other than mobile
    34  homes or manufactured homes, at retail or  wholesale;  except,  however,
    35  trailers  with  an  unladen weight of less than one thousand pounds. For
    36  the purposes of this section, a "mobile  home"  or  "manufactured  home"
    37  means  a  mobile  home  or  manufactured  home as defined in section one
    38  hundred twenty-two-c of this chapter. Any person who  sells,  or  offers
    39  for sale or lease more than five motor vehicles, motorcycles or trailers
    40  in  any calendar year or who displays or permits the display of three or
    41  more motor vehicles, motorcycles or trailers for sale at any one time or
    42  within any one calendar month upon premises owned or controlled  by  him
    43  or  her, if such vehicles were purchased, acquired or otherwise obtained
    44  by such person for the purpose of resale, will be regarded as a  dealer.
    45  For  the  purposes  of  this  section,  "offers for sale or lease" shall
    46  include, but not be limited to, the act of drawing the  public's  atten-
    47  tion  to, or the presentation or display of any motor vehicle, including
    48  the posting of images of any such vehicle,  together  with  a  suggested
    49  retail price, lease cost or financing rate for such vehicle and an offer
    50  to  provide,  the provision of, or a representation that such person may
    51  provide a service of arranging, assisting, facilitating or effecting the
    52  purchase or lease of such new motor vehicle, except this  meaning  shall
    53  not  apply to any activity of a cooperative or other advertising program
    54  or fund as described in any franchise, as such term is defined by subdi-
    55  vision six of section four hundred  sixty-two  of  this  title,  or  the
    56  display  of aggregated information and images by a national service that

        A. 6655--E                         10
 
     1  otherwise does not have contact  with  consumers.  Except  as  otherwise
     2  provided  in subdivisions three, five, six-b, and seven of this section,
     3  the term "dealer" shall include a "new motor vehicle dealer" as  defined
     4  by  paragraph  f of this subdivision and a "qualified dealer" as defined
     5  in paragraph g of this subdivision.
     6    § 11. Subdivision 3 of section 415 of the vehicle and traffic  law  is
     7  amended by adding a new paragraph d to read as follows:
     8    d. It is hereby declared to be a fraudulent practice, for the purposes
     9  of  paragraph c of subdivision nine of this section, for a dealer to use
    10  any  subsidiary  corporation,  affiliated  corporation,  or  any   other
    11  controlled  corporation, partnership, association, business or person to
    12  accomplish what would otherwise be unlawful conduct under  this  article
    13  or article thirty-five-b of the general business law, including request-
    14  ing that an automobile broker business represent such dealer in generat-
    15  ing a sale or lease or making payment to, either directly or indirectly,
    16  an automobile broker business.
    17    §  12.  Subdivision  3-a and paragraph b-3 of subdivision 5 of section
    18  415 of the vehicle and traffic law, as added by chapter 477 of the  laws
    19  of 2017, are amended to read as follows:
    20    3-a.  Automobile  broker  business  registration.  a.  No person shall
    21  engage in the automobile broker business or represent or advertise  that
    22  he or she is engaged or intends to engage in the automobile broker busi-
    23  ness  in this state, unless there shall have been issued to him or her a
    24  certificate of registration as an  automobile  broker  business  by  the
    25  commissioner under this section pursuant to an application for registra-
    26  tion submitted pursuant to subdivision five of this section. Such regis-
    27  tration  shall be effective for a period not exceeding two years. At the
    28  discretion of the commissioner a registration may be renewed for a peri-
    29  od of up to two years upon application therefor, in  such  form  as  the
    30  commissioner  may  prescribe,  and a showing of proof of satisfaction of
    31  the requirements of section seven hundred forty-a of the  general  busi-
    32  ness law, and upon payment of the fee as herein prescribed.
    33    b.  The  commissioner shall not issue or renew a certificate of regis-
    34  tration authorized by this subdivision to any dealer, franchisee,  fran-
    35  chisor, manufacturer, distributor, distributor branch or factory branch,
    36  as  such  terms  are  defined  in section four hundred sixty-two of this
    37  title, or to any subsidiary, affiliate, employee or controlled person or
    38  entity thereof.
    39    c. As a condition of any certificate of registration issued or renewed
    40  pursuant to this subdivision, an automobile broker business shall  have,
    41  and  continuously  maintain, a place of business in this state for which
    42  it shall keep  and  maintain  evidence  that  all  necessary  approvals,
    43  licenses  and/or  permits  have  been  obtained from all local governing
    44  bodies to operate such place of business with customer or  client  traf-
    45  fic.  No  more  than one automobile broker business shall operate at any
    46  single location and no automobile broker business shall operate  at  the
    47  same location as a new motor vehicle dealer.
    48    d.  Every  registered automobile broker business shall prominently and
    49  conspicuously post, in such a manner that it is likely to be  noticeable
    50  to  anyone  entering  its premises, its official business certificate of
    51  registration and a sign, which sign shall clearly state:
    52    "(Name of registered automobile broker) is not a franchised new  motor
    53  vehicle  dealer.  We are not authorized or approved by a manufacturer or
    54  distributor to sell a new motor vehicle or perform  recall  or  original
    55  factory  warranty  work.  If  you order a search for a new motor vehicle
    56  from this broker, we must make a bona fide effort to solicit  bids  from

        A. 6655--E                         11
 
     1  at  least  three  unaffiliated new motor vehicle dealers for a new motor
     2  vehicle on your behalf, including from your local dealer."
     3    e. As a condition of any certificate of registration issued or renewed
     4  pursuant  to this subdivision, and before performing any broker services
     5  related to a new motor vehicle,  an  automobile  broker  business  shall
     6  attest  in writing to each consumer, that the broker: (i) is not a fran-
     7  chised new motor vehicle dealer; (ii) is not authorized or approved by a
     8  manufacturer or distributor to sell  a  new  motor  vehicle  or  perform
     9  recall  or  original  factory  warranty  work; and (iii) that the broker
    10  shall make a bona fide effort to solicit bids from at least three  unaf-
    11  filiated  new motor vehicle dealers that sell a new motor vehicle or any
    12  line or make desired by such consumer,  including  from  the  consumer's
    13  local dealer.
    14    f. It is hereby declared to be a fraudulent practice, for the purposes
    15  of  paragraph  c  of subdivision nine of this section, for an automobile
    16  broker business to draw the public's attention to, or present or display
    17  any new motor vehicle, including by posting images of any such  vehicle,
    18  together with a suggested retail price, lease cost or financing rate for
    19  such  vehicle  and an offer to provide, the provision of, or a represen-
    20  tation that such person may provide a service of  arranging,  assisting,
    21  facilitating  or effecting the purchase or lease of such new motor vehi-
    22  cle.
    23    g. Nothing in this subdivision shall be construed to prohibit a  fran-
    24  chisor, manufacturer, or distributor from sponsoring activities intended
    25  to  generate  leads toward the sale or lease of a new motor vehicle by a
    26  franchisee.
    27    b-3. In the case of an application for registration as  an  automobile
    28  broker business, either for initial registration or renewal thereof, the
    29  name  and  address  of  the  surety  company  which  will issue the bond
    30  required by subdivision one of section  seven  hundred  forty-a  of  the
    31  general  business law, a copy of such bond certified by the secretary of
    32  state or one of his or her agents, and a statement indicating any inter-
    33  est in the applicant's business entity by a person or  entity  described
    34  in paragraph f of subdivision one or paragraph f of subdivision seven of
    35  this  section,  or  any employee or person, controlling person or entity
    36  thereof. If the bond is to be issued by an authorized agent of the sure-
    37  ty company licensed by the state, then the  name  and  address  of  that
    38  agent  may  be provided in lieu of the information concerning the surety
    39  company.
    40    § 13. Section 415 of the vehicle and traffic law is amended by  adding
    41  two new subdivisions 21 and 22 to read as follows:
    42    21. Penalties and rights of action for failure to obtain a certificate
    43  of  registration as an automobile broker pursuant to subdivision three-a
    44  and paragraph b-3 of subdivision five of this section.  In  addition  to
    45  any  other  action  authorized  by  law, the commissioner, or any person
    46  designated by him or her, may proceed against a party who  has  operated
    47  as  an  automobile broker without certificate of registration in accord-
    48  ance with the provisions of this article, in any one or more proceedings
    49  and by order to enjoin such unlawful acts or practices and requiring the
    50  offending party to pay the people of this state a penalty in a  sum  not
    51  less  than  four thousand dollars and not more than ten thousand dollars
    52  for each  violation  found  to  have  been  committed.  Civil  penalties
    53  assessed  under  this  subdivision shall be paid to the commissioner for
    54  deposit into the state treasury,  and  unpaid  civil  penalties  may  be
    55  recovered  by  the  commissioner  in  a  civil action in the name of the
    56  commissioner. For the purposes of this subdivision, a "violation"  shall

        A. 6655--E                         12
 
     1  mean  each vehicle sold or leased to a consumer for which the party that
     2  failed to obtain certification as an automobile broker has served as  an
     3  automobile broker.
     4    22. Automobile broker record requirements. a. Automobile brokers shall
     5  maintain  a  permanently bound book in which shall be recorded the make,
     6  model, year, color and vehicle identification number of  all  previously
     7  unregistered automobiles for which such broker has provided a service of
     8  purchasing, arranging, assisting, facilitating or effecting the purchase
     9  or  lease  of such automobile within any preceding six-year period. Such
    10  broker shall also record in such  book  the  name  and  address  of  the
    11  purchaser or lessor of such automobile, the date of sale or commencement
    12  of  lease of such automobile and the name and address of the dealer from
    13  which the automobile was purchased or leased.
    14    b. Automobile broker businesses shall  maintain  a  permanently  bound
    15  book  in  which  shall  be recorded all completed orders to search for a
    16  previously unregistered automobile within any preceding six-year period.
    17  Such broker shall also record in such book the date of such  order,  the
    18  name and address of the person or entity ordering such search, the auto-
    19  mobile  specifications  provided by such prospective buyer or lessee and
    20  the name and address of the dealers solicited for a quote  or  offer  on
    21  behalf of such prospective buyer or lessee.
    22    c. Such books shall be open for inspection by the commissioner, or his
    23  or  her  agent,  during  reasonable business hours. The commissioner may
    24  establish by rule the form of any such book.
    25    d. As an alternative to a bound book, an automobile broker may  use  a
    26  computer and software approved by the department to maintain the records
    27  required  to  be kept by this section, provided all information required
    28  by paragraphs a and b of this  section  are  recorded  and  the  records
    29  conform to such additional requirements as determined by the commission-
    30  er.
    31    §  14.  Subdivision  5  of section 337 of the personal property law is
    32  amended by adding a new paragraph (m) and such  section  is  amended  by
    33  adding a new subdivision 4-a to read as follows:
    34    4-a.  Any  credit application, or other request for a determination of
    35  creditworthiness, in furtherance of a retail lease agreement for  a  new
    36  motor  vehicle,  that  is  submitted to a lessor or anticipated assignee
    37  that is a manufacturer, as such term is defined in subdivision  nine  of
    38  section  four hundred sixty-two of the vehicle and traffic law, a person
    39  under contract with a manufacturer to serve  as  holder,  or  a  captive
    40  finance  source,  as  such  term  is  defined  by subdivision sixteen of
    41  section four hundred sixty-two of the vehicle  and  traffic  law,  shall
    42  include the name, address, and department of motor vehicles registration
    43  number  of  the  automobile broker business that provided the service of
    44  arranging, assisting, facilitating or effecting such agreement as agent,
    45  broker, or intermediary for such retail lessee, and the  amount  of  the
    46  fee paid by the consumer to the automobile broker business, as such term
    47  is  used  in  article thirty-five-B of the general business law, for the
    48  service of arranging, assisting, facilitating or effecting the lease  of
    49  such new motor vehicle.
    50    (m)  In  the case of a retail lease agreement for a new motor vehicle,
    51  as such term is defined in subdivision eleven of  section  four  hundred
    52  sixty-two  of  the  vehicle  and traffic law, where the lessor or antic-
    53  ipated assignee is a manufacturer, as such term is defined  in  subdivi-
    54  sion  nine  of section four hundred sixty-two of the vehicle and traffic
    55  law, a person under contract with the manufacturer of  such  leased  new
    56  motor  vehicle  to serve as holder, or a captive finance source, as such

        A. 6655--E                         13
 
     1  term is defined by subdivision sixteen of section four hundred sixty-two
     2  of the vehicle and traffic law, the name,  address,  and  department  of
     3  motor  vehicles  registration  number  of the automobile broker business
     4  that  provided  the  service  of  arranging,  assisting, facilitating or
     5  effecting such agreement as agent,  broker,  or  intermediary  for  such
     6  retail  lessee,  and  the  amount of the fee paid by the consumer to the
     7  automobile  broker  business,  as  such  term   is   used   in   article
     8  thirty-five-B of the general business law, for the service of arranging,
     9  assisting,  facilitating  or effecting the lease of such new motor vehi-
    10  cle.
    11    § 15. Severability. If any provision of this act, or  any  application
    12  of  any  provision  of  this  act, is held to be invalid, that shall not
    13  affect the validity or effectiveness of any other provision of this act,
    14  or of any other application of any provision of this act, which  can  be
    15  given effect without that provision or application; and to that end, the
    16  provisions and applications of this act are severable.
    17    §  16. This act shall take effect immediately; provided that all auto-
    18  mobile brokers registered on the effective date of this act  shall  have
    19  ninety days to come into compliance with the provisions of this act.
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