New York S 1161: Relates to establishing the banking bill of rights

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S01161 Summary:

BILL NOS01161 

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SAME ASSAME AS A11018

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SPONSORLIU

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COSPNSRFAHY, JACKSON, SKOUFIS

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MLTSPNSR

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Add §296-b, amd §296-a, Exec L; amd §9-d, Bank L

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Relates to establishing the banking bill of rights; includes due process requirements regarding applications for or closure of credit and deposit accounts and penalties for noncompliance.

Go to top S01161 Actions:

BILL NOS01161 

&nbsp

01/08/2025REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

01/07/2026REFERRED TO INVESTIGATIONS AND GOVERNMENT OPERATIONS

Go to topS01161 Committee&nbspVotes:

Go to topS01161 Floor&nbspVotes:

There are no Assembly votes for this bill in this legislative session.

Go to topS01161 Text:

 STATE OF NEW YORK
 ________________________________________________________________________

 1161

 2025-2026 Regular Sessions

 IN SENATE

 January 8, 2025
 ___________

 Introduced by Sen. LIU -- read twice and ordered printed, and when
 printed to be committed to the Committee on Investigations and Govern-
 ment Operations

 AN ACT to amend the executive law and the banking law, in relation to
 establishing the banking bill of rights

 The People of the State of New York, represented in Senate and Assem-
 bly, do enact as follows:

 1 Section 1. Legislative intent. Across New York, financial institutions
 2 terminate individuals' bank accounts or deny their applications with no
 3 reason provided or recourse allowed. These banking practices dispropor-
 4 tionately impact immigrant communities, resulting in unbanked or under-
 5 banked New Yorkers. Such practices harm consumers' credit scores and
 6 histories, creating barriers to housing, education and access to the
 7 financial industry altogether; they also block millions of dollars of
 8 donations to charitable organizations. Furthermore, these unfair and
 9 discriminatory practices create a chilling effect on local economies
 10 statewide. Personal finance deserves due process, and it is the intent
 11 of the legislature to ensure fundamental banking rights for all New
 12 Yorkers. Requiring financial institutions to disclose the reasons for
 13 adverse actions with respect to credit and deposit accounts will prevent
 14 discrimination ex ante, in addition to giving consumers an opportunity
 15 to improve their credit or financial status and rectify mistakes that
 16 may occur from misinformation or inadequate information; it will also
 17 create a beneficial competitive effect on the financial industry.
 18 § 2. The executive law is amended by adding a new section 296-b to
 19 read as follows:
 20 § 296-b. Banking bill of rights. 1. Definitions. For the purposes of
 21 this section, the following terms shall have the following meanings:
 22 a. "Financial institution" shall mean any corporation organized under
 23 and subject to the provisions of the banking law, including any bank,
 24 trust company, savings bank, savings and loan association, credit union,

 EXPLANATION--Matter in italics (underscored) is new; matter in brackets
 [ ] is old law to be omitted.
 LBD00252-01-5

 S. 1161 2

 1 mortgage broker, mortgage banker, or other investment entity, whether
 2 headquartered within or outside the state, which provides credit or a
 3 deposit account to a customer in the state.
 4 b. "Deposit account" shall mean any demand deposit account, including
 5 but not limited to, a checking account, time deposit account, certif-
 6 icate of deposit (CD), savings account, passbook account, share account,
 7 money market account, or other similar account maintained by a financial
 8 institution.
 9 c. "Adverse action" shall mean a termination or closure of an account
 10 or an unfavorable change in the terms of an account that does not affect
 11 all or substantially all of a class of the financial institution's cred-
 12 it or deposit accounts, including but not limited to, loss of privi-
 13 leges. The term "adverse action" shall not include a change in the terms
 14 of an account expressly agreed to by an account holder, or any action or
 15 forbearance relating to an account taken in connection with inactivity,
 16 default, or delinquency of such account.
 17 2. Due process requirements. Notwithstanding any other provision of
 18 law or rule or regulation to the contrary, a financi