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S01061 Summary:

BILL NOS01061A
 
SAME ASNo Same As
 
SPONSORSANDERS
 
COSPNSRCOMRIE
 
MLTSPNSR
 
Ren Art 9-A to be Art 9-B, add Art 9-A §§363 - 363-p, amd §§22, 635 & 652-b, Bank L; amd §10-136, NYC Ad Cd
 
Regulates commercial finance licensing; establishes the minority- and women-owned business protection program; provides for the study of certain impacts on underbanked and underserved areas; makes conforming technical changes thereto.
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S01061 Actions:

BILL NOS01061A
 
01/06/2021REFERRED TO BANKS
05/10/2021AMEND (T) AND RECOMMIT TO BANKS
05/10/2021PRINT NUMBER 1061A
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S01061 Text:



 
                STATE OF NEW YORK
        ________________________________________________________________________
 
                                         1061--A
 
                               2021-2022 Regular Sessions
 
                    IN SENATE
 
                                     January 6, 2021
                                       ___________
 
        Introduced  by  Sen. SANDERS -- read twice and ordered printed, and when
          printed to be  committed  to  the  Committee  on  Banks  --  committee
          discharged, bill amended, ordered reprinted as amended and recommitted
          to said committee
 
        AN  ACT to amend the banking law and the administrative code of the city
          of New York, in relation to regulating commercial  finance  licensing,
          establishing   the   minority-  and  women-owned  business  protection
          program, providing for the study of certain impacts on underbanked and
          underserved areas and making  conforming  technical  changes  relating
          thereto
 
          The  People of the State of New York, represented in Senate and Assem-
        bly, do enact as follows:
 
     1    Section 1. Article 9-A of the banking law is  renumbered  article  9-B
     2  and a new article 9-A is added to read as follows:
     3                                 ARTICLE IX-A
     4                        COMMERCIAL FINANCE LICENSING
     5  Section 363.   Doing business without license prohibited.
     6          363-a. Definitions.
     7          363-b. Exemptions.
     8          363-c. Application for license.
     9          363-d. Conditions for issuance of a license.
    10          363-e. Locations; change of address.
    11          363-f. Changes in control.
    12          363-g. Grounds for suspension or revocation.
    13          363-h. Examinations.
    14          363-i. Books and records.
    15          363-j. Advertising.
    16          363-k. Prohibited practices of licensees.
    17          363-l. Penalties.
    18          363-m. Minority- and women-owned business protection program.
    19          363-n. Study;  certain  impacts  on  underbanked and underserved
    20                   areas.
    21          363-o. Regulations.
    22          363-p. Severability.

         EXPLANATION--Matter in italics (underscored) is new; matter in brackets
                              [ ] is old law to be omitted.
                                                                   LBD04951-02-1

        S. 1061--A                          2
 
     1    § 363. Doing business without license  prohibited.  1.  No  person  or
     2  other  entity  shall  engage  in  the  business  of making or soliciting
     3  commercial financing products to businesses located in  New  York  state
     4  except  as  authorized  by  this  article  and without first obtaining a
     5  license from the superintendent.
     6    2.  For  the  purposes  of  this  article, a person or entity shall be
     7  considered as engaging in the business of  making  commercial  financing
     8  products  to  businesses  located  in  New  York state if it solicits or
     9  consummates commercial financing products to any business or  commercial
    10  enterprise located in New York state.
    11    § 363-a. Definitions. For purposes of this article:
    12    1.  "commercial  financing  product"  means  any advance of funds to a
    13  commercial or business enterprise made for the purpose of assisting  the
    14  business with its capital needs, including but not limited to:
    15    (a)  loans  or lines of credit made to a business or commercial enter-
    16  prise in a principal amount of five hundred thousand  dollars  or  less,
    17  whether secured or unsecured;
    18    (b)  purchase transactions where an entity purchases accounts, receiv-
    19  ables, intangibles, revenue or other actual or perceived assets  of  the
    20  business  if any single payment or advance of the purchase price for the
    21  purchased accounts, receivables, intangibles, revenue or other actual or
    22  perceived assets of the business is in the amount of five hundred  thou-
    23  sand dollars or less; or
    24    (c)  any leasing transaction where any funds are provided to the busi-
    25  ness or commercial enterprise by the leasing business or  any  affiliate
    26  of  the  leasing business in the amount of five hundred thousand dollars
    27  or less; and
    28    2. "making or soliciting" means  (a)  providing  commercial  financing
    29  products   to  small  businesses;  (b)  marketing  commercial  financing
    30  products for providers of commercial financing products;  (c)  receiving
    31  any  compensation from a provider of commercial financing products based
    32  on the value of the commercial financing product  provided  in  exchange
    33  for  a  referral of small business or its owner; and (d) any entity that
    34  partners with federal or state banking organization in which the federal
    35  or state banking organization originates the commercial financing  prod-
    36  uct  and the entity acquires a participation or syndication interest, in
    37  part or whole, of the commercial financing product and  the  (i)  entity
    38  receives  compensation  for  marketing or servicing the transaction from
    39  the federal or state banking organization, or collects any payments  due
    40  under  the  commercial financing product; or (ii) provides any indemnity
    41  or loss protection to the federal  or  state  banking  organization  for
    42  losses  the  federal or state banking organization may incur as a result
    43  of performance of the commercial financing product.
    44    § 363-b. Exemptions. The following shall be exempt from the provisions
    45  of this article:
    46    1. any person who makes or solicits five or fewer commercial financing
    47  products within any twelve month period;
    48    2. any banking organization,  as  defined  in  subdivision  eleven  of
    49  section two of this chapter;
    50    3. any federal credit union;
    51    4. any insurance company;
    52    5.  any  person if and to the extent that such person is lending money
    53  and licensed in accordance with, and as authorized by, any other  appli-
    54  cable  law  of  the state of New York; provided, however, such exemption
    55  shall apply only to those transactions  subject  to  requirements  under
    56  article  nine-B  of  this  chapter and such exemption shall not apply to

        S. 1061--A                          3
 
     1  transactions subject to the provisions of  this  article  that  are  not
     2  expressly regulated by article nine-B of this chapter; or
     3    6. any transaction that is intended to be a purchase of the ownership,
     4  in whole or part, of a business or commercial enterprise.
     5    §  363-c.  Application  for  license.  1. An application for a license
     6  shall be in writing, under oath, and  in  the  form  prescribed  by  the
     7  superintendent  and shall contain such information as the superintendent
     8  may require by regulation. The application shall set forth  all  of  the
     9  locations  at  which the applicant seeks to conduct business pursuant to
    10  this article. At the time of making the application for a  license,  the
    11  applicant  shall  pay to the superintendent a fee as prescribed by regu-
    12  lation for each proposed location for investigating the application.
    13    2. In connection with an application  for  a  license,  the  applicant
    14  shall  submit an affidavit of financial solvency noting such capitaliza-
    15  tion requirements and access to such credit as may be prescribed by  the
    16  regulations promulgated by the superintendent.
    17    3.  The applicant shall also prove, in form satisfactory to the super-
    18  intendent, that the applicant has available for the  operation  of  such
    19  business  at  the  location  or  locations  specified in the application
    20  liquid assets of at least fifty thousand dollars. This amount  shall  be
    21  maintained for the period within which the licensee is licensed.
    22    4.  If  a  person  or  entity  holding a license seeks to open another
    23  location for the conduct of activities licensable  under  this  article,
    24  the licensee shall first submit written notification of this fact to the
    25  superintendent.  The  notification  shall contain the address of the new
    26  location and the license number. An investigation fee as  prescribed  in
    27  regulations  shall  be paid for each additional location. The additional
    28  location shall be authorized upon written approval by the superintendent
    29  or after ninety days have passed since the notification was provided and
    30  investigation fee was paid unless the superintendent denies the  request
    31  for  an  additional location prior to the expiration of the ninety days.
    32  The superintendent may deny a request for an additional location if  the
    33  new  location  by  the  licensee is not in the public interest, in which
    34  case, the superintendent shall send a written denial to the licensee.
    35    § 363-d. Conditions for issuance of a license. Upon the filing of such
    36  application and the payment of such fees, if  the  superintendent  shall
    37  find  that  the  financial  responsibility,  experience,  character, and
    38  general fitness of the applicant, and of  the  members  thereof  if  the
    39  applicant  be  a  partnership  or  association,  and of the officers and
    40  directors thereof if the applicant be a  corporation,  are  such  as  to
    41  command  the  confidence of the community and to warrant belief that the
    42  business will be operated honestly, fairly, and efficiently  within  the
    43  purposes  of this article, and if the superintendent shall find that the
    44  applicant has available for the operation of such business at each spec-
    45  ified location liquid assets of at least  fifty  thousand  dollars,  the
    46  superintendent  shall  thereupon  execute  a  license at the location or
    47  locations specified in the said application.  The  superintendent  shall
    48  transmit  one copy of such license or licenses to the applicant and file
    49  the same in the office of the department. Each such license shall remain
    50  in full force and effect until it is  surrendered  by  the  licensee  or
    51  revoked  or  suspended  as  hereinafter  provided; if the superintendent
    52  shall not so find, a license shall not be issued and the  superintendent
    53  shall notify the applicant of the denial. If an application is denied or
    54  withdrawn  the superintendent shall return to the applicant the sum paid
    55  by the applicant as a license fee, retaining the  investigation  fee  to
    56  cover  the  costs  of investigating such application. The superintendent

        S. 1061--A                          4
 
     1  shall approve or deny every application for a master license under  this
     2  article  within  ninety days from the filing thereof with the applicable
     3  fees.
     4    §  363-e.  Locations;  change of address. 1. A license shall state the
     5  address at which the business is to be conducted and shall  state  fully
     6  the  name of the licensee, and if the licensee is a partnership or asso-
     7  ciation, the names of the members thereof, and  if  a  corporation,  the
     8  date and place of its incorporation. No license shall be transferable or
     9  assignable.
    10    2.  Every  location  used  by the licensee to conduct business must be
    11  identified in the application and approved by the superintendent.  After
    12  a  license  has  been issued, any application for a change in address or
    13  new location must be submitted within forty-five days of  such  proposed
    14  change  or addition.  The licensee shall pay to the superintendent a fee
    15  as prescribed by regulation  for  each  change  or  addition  and  shall
    16  provide  any  information  which  may  be  required  regarding  such new
    17  location. If the superintendent is not satisfied  that  such  change  or
    18  addition  is in accordance with the purposes of this article, the super-
    19  intendent shall refuse such change of location  or  additional  location
    20  and notify the licensee of such determination.
    21    §  363-f.  Changes in control. 1. It shall be unlawful except with the
    22  prior approval of the superintendent for any action to  be  taken  which
    23  results  in  a change of control of the business of a licensee. Prior to
    24  any change of control, the person desirous of acquiring control  of  the
    25  business of a licensee shall make written application to the superinten-
    26  dent  and  pay  an  investigation  fee  as prescribed by regulation. The
    27  application shall contain such information  as  the  superintendent,  by
    28  rule  or  regulation,  may prescribe as necessary or appropriate for the
    29  purpose of making the determination required by subdivision two of  this
    30  section.
    31    2.  The superintendent shall approve or disapprove the proposed change
    32  of control of a licensee in accordance with the provisions  of  sections
    33  three  hundred  sixty-three-c  and  three  hundred sixty-three-d of this
    34  article. The superintendent shall approve or disapprove the  application
    35  in  writing  within  ninety days after the date the application is filed
    36  with the superintendent.
    37    3. For a period of six months from the date of  qualification  thereof
    38  and  for  such  additional  period  of  time  as  the superintendent may
    39  prescribe, in writing, the provisions of subdivisions  one  and  two  of
    40  this  section  shall  not apply to a transfer of control by operation of
    41  law to the legal representative, as defined in subdivision four of  this
    42  section,  of  one  who has control of a licensee. Thereafter, such legal
    43  representative shall comply with the provisions of subdivisions one  and
    44  two of this section.
    45    4.  The term "legal representative", for the purposes of this section,
    46  shall mean one duly appointed by a court of  competent  jurisdiction  to
    47  act  as  executor,  administrator,  trustee,  committee,  conservator or
    48  receiver, including one who succeeds  a  legal  representative  and  one
    49  acting   in  an  ancillary  capacity  thereto  in  accordance  with  the
    50  provisions of such court appointment.
    51    5. As used in this section: (a) the term "person" includes an individ-
    52  ual, partnership, corporation, association or  any  other  organization;
    53  and (b) the term "control" means the possession, directly or indirectly,
    54  of  the  power  to  direct  or cause the direction of the management and
    55  policies of a licensee, whether through the ownership of voting stock of
    56  such licensee, the  ownership  of  voting  stock  of  any  person  which

        S. 1061--A                          5
 
     1  possesses such power or otherwise. Control shall be presumed to exist if
     2  any  person,  directly or indirectly, owns, controls or holds with power
     3  to vote ten per centum or more of the voting stock of any licensee or of
     4  any  person  which  owns,  controls  or holds with power to vote ten per
     5  centum or more of the voting stock of any licensee, but no person  shall
     6  be  deemed to control a licensee solely by reason of being an officer or
     7  director of such licensee or person.   The  superintendent  may  in  his
     8  discretion,  upon  the  application  of  a  licensee  or any person who,
     9  directly or indirectly, owns, controls or holds with power  to  vote  or
    10  seeks  to  own,  control  or hold with power to vote any voting stock of
    11  such licensee, determine whether or not the ownership, control or  hold-
    12  ing of such voting stock constitutes or would constitute control of such
    13  licensee for purposes of this section.
    14    §  363-g.  Grounds for suspension or revocation. 1. The superintendent
    15  may suspend or revoke any license  issued  under  this  article  if  the
    16  superintendent shall find that:
    17    (a)  the licensee has failed to pay any sum of money lawfully demanded
    18  by the superintendent or to comply with any demand, ruling, or  require-
    19  ment of the superintendent within a reasonable period of time;
    20    (b) the licensee has violated any provisions of this article; or
    21    (c)  any fact or condition exists which, if it had existed at the time
    22  of the  original  application  for  such  license,  clearly  would  have
    23  warranted  the  superintendent  in  refusing  originally  to  issue such
    24  license.
    25    2. The superintendent may on good cause shown, without notice or hear-
    26  ing, suspend any license for a period not exceeding thirty days, pending
    27  investigation.
    28    3. Any licensee may surrender any license by delivering to the  super-
    29  intendent  written  notice  that  the  licensee  thereby surrenders such
    30  license, but such surrender shall not affect such  licensee's  civil  or
    31  criminal liability for acts committed prior to such surrender.
    32    4.  No  revocation  or  suspension  or  surrender of any license shall
    33  impair or affect the obligation  of  any  pre-existing  lawful  contract
    34  between the licensee and any borrower.
    35    5. Every license issued pursuant to this article shall remain in force
    36  and  effect  until it shall have been surrendered, revoked, or suspended
    37  in accordance with the provisions of this article, but  the  superinten-
    38  dent  shall  have  authority to reinstate suspended licenses or to issue
    39  new licenses to a licensee whose license or  licenses  shall  have  been
    40  revoked  if  no  fact  or condition then exists which clearly would have
    41  warranted the  superintendent  in  refusing  originally  to  issue  such
    42  license under this article.
    43    6.  Whenever  the  superintendent  shall  revoke  or suspend a license
    44  issued pursuant to this article,  the  superintendent  shall  execute  a
    45  written  order to that effect. The superintendent shall file one copy of
    46  such order in the office of the department and serve  a  copy  upon  the
    47  licensee,  such  order may be reviewed in the manner provided by article
    48  seventy-eight of the civil practice law and rules. Such special proceed-
    49  ing for review as authorized by this section must  be  commenced  within
    50  thirty days from the date of such order of suspension or revocation.
    51    §  363-h.  Examinations.  For the purpose of discovering violations of
    52  this article or securing information lawfully required under this  arti-
    53  cle,  the  superintendent may at any time, and as often as may be deter-
    54  mined, either personally or by a person duly designated  by  the  super-
    55  intendent,  investigate  the  business  and examine the books, accounts,
    56  records, and files used therein of every licensee in connection with the

        S. 1061--A                          6
 
     1  activity covered under this article. For that purpose the superintendent
     2  and duly designated  representatives  shall  have  free  access  to  the
     3  offices  and place of business, books, accounts, papers, records, files,
     4  safes  and  vaults  of all such licensees. The superintendent shall have
     5  authority to require the attendance of and to  examine  under  oath  all
     6  persons whose testimony may be required relative to such business.
     7    §  363-i. Books and records. 1. The licensee shall keep and use in its
     8  business such books, accounts, and records as  will  enable  the  super-
     9  intendent  to  determine  whether  such  licensee  is complying with the
    10  provisions of this article and with the rules and  regulations  lawfully
    11  made  by  the  superintendent  pursuant  to this article. Every licensee
    12  shall preserve such books, accounts, and records for at least two  years
    13  after  the  last  payment  on any account was made or two years after an
    14  account is written off as a loss. Preservation of  photographic  reprod-
    15  uction  thereof  or  records  in photographic form, including an optical
    16  disk storage system and the use of electronic data processing  equipment
    17  that  provides  comparable records to those otherwise required and which
    18  are available for examination upon request shall  constitute  compliance
    19  with the requirements of this section.
    20    2.  Each  licensee  shall annually on or before the first day of April
    21  file a report with the superintendent giving  such  information  as  the
    22  superintendent may require concerning the business and operations during
    23  the preceding calendar year of each licensed place of business conducted
    24  by  such licensee within the state under authority of this article. Such
    25  report shall be subscribed and affirmed as true by  the  licensee  under
    26  the  penalties  of  perjury  and  shall be in the form prescribed by the
    27  superintendent who shall make and publish annually a consolidated state-
    28  ment of condition showing the combined assets  and  liabilities  of  all
    29  licensed  lenders.  Such  consolidated  statement  of condition shall be
    30  based upon the information contained in such  reports.  In  addition  to
    31  annual  reports,  the superintendent may require such additional regular
    32  or special reports as may be deemed necessary to the proper  supervision
    33  of licensees under this article. Such additional reports shall be in the
    34  form  prescribed  by  the  superintendent  and  shall  be subscribed and
    35  affirmed as true under the penalties of perjury.
    36    § 363-j. Advertising. 1. No licensee shall advertise, print,  display,
    37  publish,  distribute,  or broadcast or cause or permit to be advertised,
    38  printed, displayed,  published,  distributed,  or  broadcasted,  in  any
    39  manner  whatsoever  any  statement  or representation with regard to the
    40  rates, terms, costs or conditions for  a  commercial  financing  product
    41  which is false, misleading or deceptive.
    42    2.  No licensee shall make, directly or indirectly, orally or in writ-
    43  ing, by any method, practice or device, any representation  that  it  is
    44  licensed  under this article, except a representation that such licensee
    45  is licensed as a licensed commercial financing provider by  the  depart-
    46  ment.
    47    3.  No  licensee  shall  transact any business subject to this article
    48  under any other name or at any other place of business than  that  named
    49  in the license, except as may be authorized by the superintendent.
    50    §  363-k. Prohibited practices of licensees. 1. No licensee shall take
    51  any confession of judgment or any power of attorney running  to  himself
    52  or to any third person to confess judgment or to appear for the borrower
    53  in a judicial proceeding.
    54    2.  No  licensee shall take any instrument in which blanks are left to
    55  be filled in after execution.

        S. 1061--A                          7
 
     1    § 363-l. Penalties. 1. Any commercial  financing  product  made  by  a
     2  person not licensed under this article, and not exempt, to a business or
     3  commercial  enterprise  located  in  this  state  shall be void, and the
     4  provider shall have no right to collect or receive any principal, inter-
     5  est, fees or charges whatsoever. No action to enforce a transaction made
     6  in violation of this subdivision may be maintained.
     7    2.  Any  person  or  other  entity  including the officers, directors,
     8  agents, and employees thereof, which shall violate or participate in the
     9  violation of any of the provisions of section three hundred  sixty-three
    10  of this article shall be guilty of a misdemeanor.
    11    §  363-m.  Minority-  and  women-owned business protection program. 1.
    12  Legislative findings. (a) The American Rescue Plan Act of 2021 is a  one
    13  trillion nine hundred billion dollar economic stimulus legislation pack-
    14  age  passed by congress and signed into law by president Joseph Biden on
    15  March eleventh, two thousand twenty-one.
    16    (b) Many local small businesses including  minority-  and  women-owned
    17  businesses  (MWBE's)  in  our  state did not receive any federal funding
    18  under the federal paycheck protection program (PPP).
    19    (c) As New York state is reopening regionally post COVID-19,  many  of
    20  our  MWBE's  who  did  not  receive PPP funding are in desperate need of
    21  funding to employ and/or pay staff, purchase inventory and pay rent  and
    22  utilities.
    23    (d)  MWBE's  have  historically  had  difficulty  accessing  credit on
    24  reasonable terms and have been denied access to credit.
    25    2.  Establishment  and  initial  funding.  (a)   Notwithstanding   any
    26  provision  of  law to the contrary, the legislature and the empire state
    27  development corporation shall establish the  minority-  and  women-owned
    28  business  (MWBE)  development  and  lending  program to be funded in the
    29  initial amount of one hundred million dollars from funds received pursu-
    30  ant to the American Rescue Plan Act of 2021  and  state  appropriations.
    31  Funds received pursuant to the American Rescue Plan Act of 2021 shall be
    32  used  to reimburse any monies appropriated by the state for the purposes
    33  described under subdivision four of this section.
    34    (b) In addition to such initial  funding,  ongoing  funding  for  such
    35  program  shall  come  from  at least fifty percent of the fees collected
    36  from licensees or entities that are required to be licensed  under  this
    37  article.  Such  funds  may be used to fund ongoing grants to MWBE's that
    38  are unable to access credit at reasonable costs.
    39    (c) Any licensee offering a commercial  financing  product  through  a
    40  contract  or arrangement with any banking organization or federal credit
    41  union organized under the laws of another state, under which such  bank-
    42  ing  organization  or  federal  credit  union  originates the commercial
    43  financing product, shall report the  total  volume  of  such  commercial
    44  financing transactions in each year in New York state to the superinten-
    45  dent  who  shall then set a fee per transaction to fund MWBE development
    46  and lending.
    47    3. Eligibility. Entities shall be eligible for funding  provided  such
    48  entity:
    49    (a) employs less than one hundred employees per workplace;
    50    (b)  existed  in New York state on the first day of the state disaster
    51  emergency declared pursuant to executive order two hundred two  and  any
    52  further amendments or modifications thereto;
    53    (c)  can document actual economic harm, including, but not limited to,
    54  a revenue shortfall, as a direct result of the state disaster  emergency
    55  declared  pursuant  to  executive  order two hundred two and any further
    56  amendments or modifications thereto; and

        S. 1061--A                          8
 
     1    (d) filed tax returns for calendar year  two  thousand  eighteen,  two
     2  thousand nineteen, or two thousand twenty.
     3    4.  Grants.  The  MWBE  protection program shall provide the following
     4  grants in an amount equal to sixty percent of the  prior  year  eligible
     5  expenses, not to exceed one hundred thousand dollars:
     6    (a)  a  rent  reimbursement grant to reimburse qualifying entities for
     7  rent paid during the COVID-19 pandemic, provided such entity  has  docu-
     8  mentary  proof  of such paid rent. Rent reimbursement shall be capped at
     9  three months of paid rent during the state of emergency;
    10    (b) a perishable inventory grant to reimburse qualifying entities  for
    11  perishable  inventory  purchased  prior  to the state disaster emergency
    12  declared pursuant to executive order two hundred  two  and  any  further
    13  amendments  or modifications thereto and discarded due to such executive
    14  order;
    15    (c) a payroll grant for the compensation  of  independent  contractors
    16  who complete the federal tax form 1099; and
    17    (d) a utilities grant.
    18    5.  Oversight. The state comptroller shall monitor the MWBE protection
    19  program to ensure the provisions of this section are properly  executed.
    20  The  state  comptroller  shall  submit  a  report on such program to the
    21  governor, the temporary president of the senate and the speaker  of  the
    22  assembly  and  shall  post such report on the comptroller's website on a
    23  quarterly basis describing any grants awarded under such program.
    24    § 363-n. Study; certain impacts on underbanked and underserved  areas.
    25  1.  The  empire  state  development corporation, in conjunction with the
    26  department and any other agency or  department  deemed  necessary  shall
    27  study the following:
    28    (a)  The  impacts  of  the COVID-19 pandemic on underbanked and under-
    29  served areas, access to loans by  small  businesses,  as  such  term  is
    30  defined  by  section  one hundred thirty-one of the economic development
    31  law and access to loans by minority-  and  women-owned  business  enter-
    32  prises,  as  such terms are defined in subdivisions seven and fifteen of
    33  section three hundred ten of the executive law; and
    34    (b) The impacts of article eight of the financial services law.
    35    2. Topics to examine shall include, but shall not be limited to:
    36    (a) the ability of individuals in underbanked and underserved areas to
    37  receive, access and use their stimulus payments;
    38    (b) changes in the banking habits of individuals  in  underbanked  and
    39  underserved areas;
    40    (c)  closures or changes to bank hours, staffing levels or services in
    41  banks in underbanked or underserved areas;
    42    (d) the number of small businesses applying for loans, the  number  of
    43  small  businesses  receiving  approval  for such loans and the amount of
    44  money such small businesses received in loans;
    45    (e) the number  of  minority-  and  women-owned  business  enterprises
    46  applying  for  loans,  the  number of minority- and women-owned business
    47  enterprises receiving approval for such loans and the  amount  of  money
    48  such minority- and women-owned business enterprises received in loans;
    49    (f)  the types of loans small businesses and minority- and women-owned
    50  business enterprises are applying for and the types of loans such  busi-
    51  nesses are approved for; and
    52    (g) the number of small businesses and minority- and women-owned busi-
    53  ness  enterprises  that  closed due to an inability to access or receive
    54  loans.
    55    3. The department shall analyze any gaps in service to underbanked and
    56  underserved areas and the impact of the disclosures required in  accord-

        S. 1061--A                          9
 
     1  ance  with  article  eight  of the financial services law on small busi-
     2  nesses and minority- and women-owned business enterprises.  The  depart-
     3  ment  shall  provide recommendations to address any such service gaps to
     4  ensure individuals living in such areas and businesses operating in such
     5  areas can access services.
     6    4.  The  superintendent  shall submit the results of these studies and
     7  all recommendations to the governor,  the  temporary  president  of  the
     8  senate  and  the  speaker of the assembly and shall publish such results
     9  and recommendations on the department's website no later  than  November
    10  first, two thousand twenty-one.
    11    5.  No  licensee  or entity that is required to be licensed under this
    12  article shall provide any disclosures required by article eight  of  the
    13  financial  services  law  until  six  months after the completion of the
    14  studies commissioned by the  superintendent  or  six  months  after  the
    15  superintendent  issues  regulations under article eight of the financial
    16  services law, whichever is later. Such regulations shall account for the
    17  results of the studies mandated by this article.
    18    § 363-o. Regulations. The  superintendent  is  hereby  authorized  and
    19  empowered  to make such general rules and regulations, and such specific
    20  rulings, demands, and findings  as  may  be  necessary  for  the  proper
    21  conduct  of  the  business  authorized  and  licensed  under and for the
    22  enforcement of this article, in addition  hereto  and  not  inconsistent
    23  herewith.
    24    §  363-p. Severability. If any provision of this article or the appli-
    25  cation thereof to any person or circumstances is  held  to  be  invalid,
    26  such  invalidity  shall  not  affect other provisions or applications of
    27  this article which can be given effect without the invalid provision  or
    28  application,  and to this end the provisions of this article are severa-
    29  ble.
    30    § 2. Paragraph 5 of subdivision a of section 10-136 of the administra-
    31  tive code of the city of New York, as added by local law  number  80  of
    32  the city of New York for the year 1996, is amended to read as follows:
    33    (5)  "Check  cashing  business" shall mean any person duly licensed by
    34  the superintendent of banks to engage in the business of cashing checks,
    35  drafts or money orders for consideration pursuant to the  provisions  of
    36  article [9-A] 9-B of the banking law.
    37    §  3.  Subdivision (a) of section 22 of the banking law, as amended by
    38  chapter 553 of the laws of 2007, is amended to read as follows:
    39    (a) Notwithstanding any other provision of law, every applicant for  a
    40  license,  authorization  or  registration  under  articles nine, nine-A,
    41  nine-B, eleven-B, twelve-B, twelve-C, twelve-D, twelve-E and  thirteen-B
    42  of  this  chapter  and  every applicant filing an application to acquire
    43  control of any licensee or registrant, as the case may  be,  under  such
    44  articles  shall  submit  simultaneously  with an application, his or her
    45  fingerprints in such form and in such manner as specified by  the  divi-
    46  sion  of  criminal  justice services, but in any event, no less than two
    47  digit imprints. The superintendent shall submit such fingerprints to the
    48  division of criminal justice services for the purpose  of  conducting  a
    49  criminal  history  search  and  returning a report thereon in accordance
    50  with the procedures and requirements established by the division  pursu-
    51  ant to the provisions of article thirty-five of the executive law, which
    52  shall  include the payment of the prescribed processing fees. The super-
    53  intendent shall request that the division submit  such  fingerprints  to
    54  the  federal  bureau of investigation, together with the processing fees
    55  prescribed by such bureau, for the  purpose  of  conducting  a  criminal
    56  history search and returning a report thereon. An applicant shall not be

        S. 1061--A                         10
 
     1  required  to submit his or her fingerprints as required by this subdivi-
     2  sion if such applicant (i) is  already  subject  to  regulation  by  the
     3  department  and  the  applicant  has  submitted such fingerprints to the
     4  department,  such  fingerprints  have  been submitted to the division of
     5  criminal justice services for  the  purpose  of  conducting  a  criminal
     6  history  search,  and  a  report of such search has been received by the
     7  department from such division; or (ii) is subject  to  regulation  by  a
     8  federal  bank  regulatory  agency and has submitted such fingerprints to
     9  such agency which has had a criminal history search  conducted  of  such
    10  individual  and has shared such information or its determination result-
    11  ing from such search with the department; or  (iii)  is  an  officer  or
    12  stockholder  of  a corporation whose common or preferred stock is regis-
    13  tered on a national securities  exchange,  as  provided  in  an  act  of
    14  congress  of  the United States entitled the "Securities Exchange Act of
    15  1934", approved June sixth, nineteen hundred thirty-four, as amended, or
    16  such other exchange or market system as the superintendent shall approve
    17  by regulation, and has submitted such fingerprints to such  exchange  or
    18  market  system which has had a criminal history search conducted of such
    19  individual and has shared such information or its determination  result-
    20  ing  from  such  search with the department; provided, however, that the
    21  superintendent may subsequently require such applicant to submit his  or
    22  her fingerprints if the superintendent has a reasonable basis for updat-
    23  ing  the  information  or determination resulting from the report of the
    24  criminal history search conducted at the request of such federal banking
    25  agency, exchange or market system.
    26    § 4. Subdivision 2 of section 635 of the banking law,  as  amended  by
    27  chapter 146 of the laws of 2003, is amended to read as follows:
    28    2.  "License"  when used in this article means any license duly issued
    29  by the superintendent  pursuant  to  the  provisions  of  article  nine,
    30  nine-A,  nine-B, eleven-B, twelve-B, twelve-C, twelve-D or thirteen-B of
    31  this chapter or any registration certificate issued by  the  superinten-
    32  dent pursuant to the provisions of article twelve-D of this chapter.
    33    §  5.  Subdivision  1 of section 652-b of the banking law, as added by
    34  chapter 374 of the laws of 1979, is amended to read as follows:
    35    1. It shall be unlawful for any transmitter of money or its  officers,
    36  affiliates or subsidiaries to enter into an agreement with a check cash-
    37  er,  licensed  pursuant  to the provisions of article [nine-A] nine-B of
    38  this chapter, whereby credit is extended to the check casher at the same
    39  time as, and on the condition that, the transmitter of money enters into
    40  an agreement with the check casher whereby the  check  casher  will  (1)
    41  sell  only the New York instruments or New York traveler's checks of the
    42  transmitter of money or (2) agree to the exclusive use  of  any  of  the
    43  other  services  of  the  transmitter of money.   This section shall not
    44  apply to the issuance by a transmitter of money of a  guarantee  of  any
    45  indebtedness  of  a  check casher licensed pursuant to the provisions of
    46  article [nine-A] nine-B of this chapter.
    47    § 6. This act shall take effect on the one hundred eightieth day after
    48  it shall have become a law.  Effective immediately, the addition, amend-
    49  ment and/or repeal of any rule or regulation necessary for the implemen-
    50  tation of this act on its effective date are authorized to be  made  and
    51  completed on or before such effective date.
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