2005 Legislative Update
from the New York State Assembly
Committee on Banks
|Sheldon Silver, Speaker • Catherine Nolan, Chair • November 2005
As Chairwoman of the Assembly Banks Committee, I am pleased to provide an update on the Committee’s activities during the 2005 legislative session. Thanks to the continued support of Speaker Sheldon Silver and the cooperation of my Assembly colleagues, the Banks Committee enjoyed a very productive session. The Committee passed legislation that would protect homeowners in default or foreclosure against home equity theft scams, and also passed legislation that fights identity theft. The Committee also worked on new laws that will deter counterfeit check scams, help Holocaust victims settle unresolved financial claims, and improve the supervision of New York’s regulated financial entities. In addition, the Assembly Banks Committee held four public hearings, on the topics of: identity theft, refund anticipation loans, home equity theft, and the Banking Development District Program – a program which gives banks incentives to open branches in underserved locations.
As always, I strongly encourage any person with questions or concerns for the Banks Committee to contact me.
In May 2005, the Assembly Banks Committee conducted a public hearing on the topic of home equity theft. Equity theft scams involve homeowners, many of whom are low- and middle-income or elderly, who fall behind on their mortgages, at which point they are approached by unscrupulous individuals or businesses who promise to help solve their problems. Instead of receiving assistance, however, the homeowners are misled into surrendering their property titles for little or no benefit to themselves.
Home Equity Theft Prevention Act — In response to the concerns raised at this hearing, the Banks Committee reported and the Assembly passed A.7667-A (Nolan), which would enact the Home Equity Theft Prevention Act. This legislation would provide protections for homeowners in default or foreclosure who sell their homes, including: requiring that any sales agreement between an equity seller and an equity purchaser be in writing; prohibiting equity purchasers from engaging in deceitful practices; and, affording homeowners a reasonable opportunity to rescind sales to equity purchasers.
Deterring Counterfeit Check Scams
New York State Counterfeit Check Awareness Act — A.6808-A (Nolan), which has been signed into law by the Governor (Chapter 268), will be a deterrent against this type of scam by requiring licensed check cashers to post a statement informing the public that cashing a forged check is illegal, and that any individual who knowingly cashes a forged check will be prosecuted under the Penal Law.
Preventing Identity Theft
Registration of “Non-Bank” ATMs — In one common variety of identity theft, thieves tamper with automated teller machines (ATMs) – or even set up counterfeit machines – therefore compromising the privacy of customers who use those machines. Currently, ATMs operated by entities other than banks do not have to be registered with the New York State Banking Department. A.1360 (Nolan) would require such “non-bank” ATMs to register with the Department; this state oversight would ensure greater protection for ATM customers’ private financial information. This bill has passed the Assembly.
Protecting the Banking Interests of Holocaust Survivors
Holocaust Claims Processing Office Annual Reports — A.1911 (Nolan), which has been signed into law by the Governor (Chapter 249), will require the Superintendent of Banks to submit annual reports concerning the policies and activities of the Holocaust Claims Processing Office. These reports will draw further attention to the mission and accomplishments of this important office, and also will be used to improve the office’s ability to settle the financial claims of Holocaust survivors.
Supporting Community Development Initiatives
Community Development Financial Institutions Act — A.1205 (Nolan) would create the Community Development Financial Institutions Fund. This fund would provide financial and technical assistance to CDFIs, so that they in turn could provide improved financing opportunities to individuals and businesses that are not being served by traditional lenders. This bill has passed the Assembly.
Ensuring the Effective Regulation of the Banking Industry
A.8472 (Boyland) — This bill, which has been signed into law by the Governor (Chapter 233), will codify in statute certain aspects of the New York State Banking Department’s current regulatory policy in regards to the location and operation of licensed check cashers.
A.8474 (Nolan) — This bill, which has been signed into law by the Governor (Chapter 232), will strengthen the Banking Department’s ability to supervise the money transmitter industry by prohibiting certain entities from engaging in money transmission activities.
Establishing Fair Practices in the use of Payroll Cards
New York State Banking Payroll Card Protection Act — A.5456 (Nolan) would establish the New York State Banking Payroll Card Protection Act, which would clarify rights and obligations for employees regarding fees, costs, statements and other issues related to the use of payroll cards. This bill has passed the Assembly.
Assemblymember Catherine Nolan • Chairwoman, Committee on Banks
Room 424 LOB • Albany, NY 12248 • 518.455.4851
New York State Assembly
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