LBD13542-01-9
S. 6688 2
EXCEPT AS AUTHORIZED BY THIS ARTICLE AND WITHOUT FIRST OBTAINING A
LICENSE FROM THE SUPERINTENDENT.
2. FOR THE PURPOSES OF THIS ARTICLE, A PERSON OR ENTITY SHALL BE
CONSIDERED AS ENGAGING IN THE BUSINESS OF MAKING COMMERCIAL FINANCING
PRODUCTS TO BUSINESSES LOCATED IN NEW YORK STATE IF IT SOLICITS OR
CONSUMMATES COMMERCIAL FINANCING PRODUCTS TO ANY BUSINESS OR COMMERCIAL
ENTERPRISE LOCATED IN NEW YORK STATE.
§ 363-A. DEFINITIONS. FOR PURPOSES OF THIS ARTICLE:
1. "COMMERCIAL FINANCING PRODUCT" MEANS ANY ADVANCE OF FUNDS TO A
COMMERCIAL OR BUSINESS ENTERPRISE MADE FOR THE PURPOSE OF ASSISTING THE
BUSINESS WITH ITS CAPITAL NEEDS, INCLUDING BUT NOT LIMITED TO:
(A) LOANS OR LINES OF CREDIT MADE TO A BUSINESS OR COMMERCIAL ENTER-
PRISE IN A PRINCIPAL AMOUNT OF FIVE HUNDRED THOUSAND DOLLARS OR LESS,
WHETHER SECURED OR UNSECURED;
(B) PURCHASE TRANSACTIONS WHERE AN ENTITY PURCHASES ACCOUNTS, RECEIV-
ABLES, INTANGIBLES, REVENUE OR OTHER ACTUAL OR PERCEIVED ASSETS OF THE
BUSINESS IF ANY SINGLE PAYMENT OR ADVANCE OF THE PURCHASE PRICE FOR THE
PURCHASED ACCOUNTS, RECEIVABLES, INTANGIBLES, REVENUE OR OTHER ACTUAL OR
PERCEIVED ASSETS OF THE BUSINESS IS IN THE AMOUNT OF FIVE HUNDRED THOU-
SAND DOLLARS OR LESS; OR
(C) ANY LEASING TRANSACTION WHERE ANY FUNDS ARE PROVIDED TO THE BUSI-
NESS OR COMMERCIAL ENTERPRISE BY THE LEASING BUSINESS OR ANY AFFILIATE
OF THE LEASING BUSINESS IN THE AMOUNT OF FIVE HUNDRED THOUSAND DOLLARS
OR LESS; AND
2. "MAKING OR SOLICITING" MEANS (A) PROVIDING COMMERCIAL FINANCING
PRODUCTS TO SMALL BUSINESSES; (B) MARKETING COMMERCIAL FINANCING
PRODUCTS FOR PROVIDERS OF COMMERCIAL FINANCING PRODUCTS; (C) RECEIVING
ANY COMPENSATION FROM A PROVIDER OF COMMERCIAL FINANCING PRODUCTS BASED
ON THE VALUE OF THE COMMERCIAL FINANCING PRODUCT PROVIDED IN EXCHANGE
FOR A REFERRAL OF SMALL BUSINESS OR ITS OWNER; AND (D) ANY ENTITY THAT
PARTNERS WITH FEDERAL OR STATE BANKING ORGANIZATION IN WHICH THE FEDERAL
OR STATE BANKING ORGANIZATION ORIGINATES THE COMMERCIAL FINANCING PROD-
UCT AND THE ENTITY ACQUIRES A PARTICIPATION OR SYNDICATION INTEREST, IN
PART OR WHOLE, OF THE COMMERCIAL FINANCING PRODUCT AND THE (I) ENTITY
RECEIVES COMPENSATION FOR MARKETING OR SERVICING THE TRANSACTION FROM
THE FEDERAL OR STATE BANKING ORGANIZATION, OR COLLECTS ANY PAYMENTS DUE
UNDER THE COMMERCIAL FINANCING PRODUCT; OR (II) PROVIDES ANY INDEMNITY
OR LOSS PROTECTION TO THE FEDERAL OR STATE BANKING ORGANIZATION FOR
LOSSES THE FEDERAL OR STATE BANKING ORGANIZATION MAY INCUR AS A RESULT
OF PERFORMANCE OF THE COMMERCIAL FINANCING PRODUCT.
§ 363-B. EXEMPTIONS. THE FOLLOWING SHALL BE EXEMPT FROM THE PROVISIONS
OF THIS ARTICLE:
1. ANY PERSON WHO MAKES OR SOLICITS FIVE OR FEWER COMMERCIAL FINANCING
PRODUCTS WITHIN ANY TWELVE MONTH PERIOD;
2. ANY BANKING ORGANIZATION, AS DEFINED IN SUBDIVISION ELEVEN OF
SECTION TWO OF THIS CHAPTER;
3. ANY FEDERAL CREDIT UNION;
4. ANY INSURANCE COMPANY;
5. ANY PERSON IF AND TO THE EXTENT THAT SUCH PERSON IS LENDING MONEY
AND LICENSED IN ACCORDANCE WITH, AND AS AUTHORIZED BY, ANY OTHER APPLI-
CABLE LAW OF THE STATE OF NEW YORK; PROVIDED, HOWEVER, SUCH EXEMPTION
SHALL APPLY ONLY TO THOSE TRANSACTIONS SUBJECT TO REQUIREMENTS UNDER
ARTICLE NINE-B OF THIS CHAPTER AND SUCH EXEMPTION SHALL NOT APPLY TO
TRANSACTIONS SUBJECT TO THE PROVISIONS OF THIS ARTICLE THAT ARE NOT
EXPRESSLY REGULATED BY ARTICLE NINE-B OF THIS CHAPTER; OR
S. 6688 3
6. ANY TRANSACTION THAT IS INTENDED TO BE A PURCHASE OF THE OWNERSHIP,
IN WHOLE OR PART, OF A BUSINESS OR COMMERCIAL ENTERPRISE.
§ 363-C. APPLICATION FOR LICENSE. 1. AN APPLICATION FOR A LICENSE
SHALL BE IN WRITING, UNDER OATH, AND IN THE FORM PRESCRIBED BY THE
SUPERINTENDENT AND SHALL CONTAIN SUCH INFORMATION AS THE SUPERINTENDENT
MAY REQUIRE BY REGULATION. THE APPLICATION SHALL SET FORTH ALL OF THE
LOCATIONS AT WHICH THE APPLICANT SEEKS TO CONDUCT BUSINESS PURSUANT TO
THIS ARTICLE. AT THE TIME OF MAKING THE APPLICATION FOR A LICENSE, THE
APPLICANT SHALL PAY TO THE SUPERINTENDENT A FEE AS PRESCRIBED BY REGU-
LATION FOR EACH PROPOSED LOCATION FOR INVESTIGATING THE APPLICATION.
2. IN CONNECTION WITH AN APPLICATION FOR A LICENSE, THE APPLICANT
SHALL SUBMIT AN AFFIDAVIT OF FINANCIAL SOLVENCY NOTING SUCH CAPITALIZA-
TION REQUIREMENTS AND ACCESS TO SUCH CREDIT AS MAY BE PRESCRIBED BY THE
REGULATIONS PROMULGATED BY THE SUPERINTENDENT.
3. THE APPLICANT SHALL ALSO PROVE, IN FORM SATISFACTORY TO THE SUPER-
INTENDENT, THAT THE APPLICANT HAS AVAILABLE FOR THE OPERATION OF SUCH
BUSINESS AT THE LOCATION OR LOCATIONS SPECIFIED IN THE APPLICATION
LIQUID ASSETS OF AT LEAST FIFTY THOUSAND DOLLARS. THIS AMOUNT SHALL BE
MAINTAINED FOR THE PERIOD WITHIN WHICH THE LICENSEE IS LICENSED.
4. IF A PERSON OR ENTITY HOLDING A LICENSE SEEKS TO OPEN ANOTHER
LOCATION FOR THE CONDUCT OF ACTIVITIES LICENSABLE UNDER THIS ARTICLE,
THE LICENSEE SHALL FIRST SUBMIT WRITTEN NOTIFICATION OF THIS FACT TO THE
SUPERINTENDENT. THE NOTIFICATION SHALL CONTAIN THE ADDRESS OF THE NEW
LOCATION AND THE LICENSE NUMBER. AN INVESTIGATION FEE AS PRESCRIBED IN
REGULATIONS SHALL BE PAID FOR EACH ADDITIONAL LOCATION. THE ADDITIONAL
LOCATION SHALL BE AUTHORIZED UPON WRITTEN APPROVAL BY THE SUPERINTENDENT
OR AFTER NINETY DAYS HAVE PASSED SINCE THE NOTIFICATION WAS PROVIDED AND
INVESTIGATION FEE WAS PAID UNLESS THE SUPERINTENDENT DENIES THE REQUEST
FOR AN ADDITIONAL LOCATION PRIOR TO THE EXPIRATION OF THE NINETY DAYS.
THE SUPERINTENDENT MAY DENY A REQUEST FOR AN ADDITIONAL LOCATION IF THE
NEW LOCATION BY THE LICENSEE IS NOT IN THE PUBLIC INTEREST, IN WHICH
CASE, THE SUPERINTENDENT SHALL SEND A WRITTEN DENIAL TO THE LICENSEE.
§ 363-D. CONDITIONS FOR ISSUANCE OF A LICENSE. UPON THE FILING OF SUCH
APPLICATION AND THE PAYMENT OF SUCH FEES, IF THE SUPERINTENDENT SHALL
FIND THAT THE FINANCIAL RESPONSIBILITY, EXPERIENCE, CHARACTER, AND
GENERAL FITNESS OF THE APPLICANT, AND OF THE MEMBERS THEREOF IF THE
APPLICANT BE A PARTNERSHIP OR ASSOCIATION, AND OF THE OFFICERS AND
DIRECTORS THEREOF IF THE APPLICANT BE A CORPORATION, ARE SUCH AS TO
COMMAND THE CONFIDENCE OF THE COMMUNITY AND TO WARRANT BELIEF THAT THE
BUSINESS WILL BE OPERATED HONESTLY, FAIRLY, AND EFFICIENTLY WITHIN THE
PURPOSES OF THIS ARTICLE, AND IF THE SUPERINTENDENT SHALL FIND THAT THE
APPLICANT HAS AVAILABLE FOR THE OPERATION OF SUCH BUSINESS AT EACH SPEC-
IFIED LOCATION LIQUID ASSETS OF AT LEAST FIFTY THOUSAND DOLLARS, THE
SUPERINTENDENT SHALL THEREUPON EXECUTE A LICENSE AT THE LOCATION OR
LOCATIONS SPECIFIED IN THE SAID APPLICATION. THE SUPERINTENDENT SHALL
TRANSMIT ONE COPY OF SUCH LICENSE OR LICENSES TO THE APPLICANT AND FILE
THE SAME IN THE OFFICE OF THE DEPARTMENT. EACH SUCH LICENSE SHALL REMAIN
IN FULL FORCE AND EFFECT UNTIL IT IS SURRENDERED BY THE LICENSEE OR
REVOKED OR SUSPENDED AS HEREINAFTER PROVIDED; IF THE SUPERINTENDENT
SHALL NOT SO FIND, A LICENSE SHALL NOT BE ISSUED AND THE SUPERINTENDENT
SHALL NOTIFY THE APPLICANT OF THE DENIAL. IF AN APPLICATION IS DENIED OR
WITHDRAWN THE SUPERINTENDENT SHALL RETURN TO THE APPLICANT THE SUM PAID
BY THE APPLICANT AS A LICENSE FEE, RETAINING THE INVESTIGATION FEE TO
COVER THE COSTS OF INVESTIGATING SUCH APPLICATION. THE SUPERINTENDENT
SHALL APPROVE OR DENY EVERY APPLICATION FOR A MASTER LICENSE UNDER THIS
S. 6688 4
ARTICLE WITHIN NINETY DAYS FROM THE FILING THEREOF WITH THE APPLICABLE
FEES.
§ 363-E. LOCATIONS; CHANGE OF ADDRESS. 1. A LICENSE SHALL STATE THE
ADDRESS AT WHICH THE BUSINESS IS TO BE CONDUCTED AND SHALL STATE FULLY
THE NAME OF THE LICENSEE, AND IF THE LICENSEE IS A PARTNERSHIP OR ASSO-
CIATION, THE NAMES OF THE MEMBERS THEREOF, AND IF A CORPORATION, THE
DATE AND PLACE OF ITS INCORPORATION. NO LICENSE SHALL BE TRANSFERABLE OR
ASSIGNABLE.
2. EVERY LOCATION USED BY THE LICENSEE TO CONDUCT BUSINESS MUST BE
IDENTIFIED IN THE APPLICATION AND APPROVED BY THE SUPERINTENDENT. AFTER
A LICENSE HAS BEEN ISSUED, ANY APPLICATION FOR A CHANGE IN ADDRESS OR
NEW LOCATION MUST BE SUBMITTED WITHIN FORTY-FIVE DAYS OF SUCH PROPOSED
CHANGE OR ADDITION. THE LICENSEE SHALL PAY TO THE SUPERINTENDENT A FEE
AS PRESCRIBED BY REGULATION FOR EACH CHANGE OR ADDITION AND SHALL
PROVIDE ANY INFORMATION WHICH MAY BE REQUIRED REGARDING SUCH NEW
LOCATION. IF THE SUPERINTENDENT IS NOT SATISFIED THAT SUCH CHANGE OR
ADDITION IS IN ACCORDANCE WITH THE PURPOSES OF THIS ARTICLE, THE SUPER-
INTENDENT SHALL REFUSE SUCH CHANGE OF LOCATION OR ADDITIONAL LOCATION
AND NOTIFY THE LICENSEE OF SUCH DETERMINATION.
§ 363-F. CHANGES IN CONTROL. 1. IT SHALL BE UNLAWFUL EXCEPT WITH THE
PRIOR APPROVAL OF THE SUPERINTENDENT FOR ANY ACTION TO BE TAKEN WHICH
RESULTS IN A CHANGE OF CONTROL OF THE BUSINESS OF A LICENSEE. PRIOR TO
ANY CHANGE OF CONTROL, THE PERSON DESIROUS OF ACQUIRING CONTROL OF THE
BUSINESS OF A LICENSEE SHALL MAKE WRITTEN APPLICATION TO THE SUPERINTEN-
DENT AND PAY AN INVESTIGATION FEE AS PRESCRIBED BY REGULATION. THE
APPLICATION SHALL CONTAIN SUCH INFORMATION AS THE SUPERINTENDENT, BY
RULE OR REGULATION, MAY PRESCRIBE AS NECESSARY OR APPROPRIATE FOR THE
PURPOSE OF MAKING THE DETERMINATION REQUIRED BY SUBDIVISION TWO OF THIS
SECTION.
2. THE SUPERINTENDENT SHALL APPROVE OR DISAPPROVE THE PROPOSED CHANGE
OF CONTROL OF A LICENSEE IN ACCORDANCE WITH THE PROVISIONS OF SECTIONS
THREE HUNDRED SIXTY-THREE-C AND THREE HUNDRED SIXTY-THREE-D OF THIS
ARTICLE. THE SUPERINTENDENT SHALL APPROVE OR DISAPPROVE THE APPLICATION
IN WRITING WITHIN NINETY DAYS AFTER THE DATE THE APPLICATION IS FILED
WITH THE SUPERINTENDENT.
3. FOR A PERIOD OF SIX MONTHS FROM THE DATE OF QUALIFICATION THEREOF
AND FOR SUCH ADDITIONAL PERIOD OF TIME AS THE SUPERINTENDENT MAY
PRESCRIBE, IN WRITING, THE PROVISIONS OF SUBDIVISIONS ONE AND TWO OF
THIS SECTION SHALL NOT APPLY TO A TRANSFER OF CONTROL BY OPERATION OF
LAW TO THE LEGAL REPRESENTATIVE, AS DEFINED IN SUBDIVISION FOUR OF THIS
SECTION, OF ONE WHO HAS CONTROL OF A LICENSEE. THEREAFTER, SUCH LEGAL
REPRESENTATIVE SHALL COMPLY WITH THE PROVISIONS OF SUBDIVISIONS ONE AND
TWO OF THIS SECTION.
4. THE TERM "LEGAL REPRESENTATIVE", FOR THE PURPOSES OF THIS SECTION,
SHALL MEAN ONE DULY APPOINTED BY A COURT OF COMPETENT JURISDICTION TO
ACT AS EXECUTOR, ADMINISTRATOR, TRUSTEE, COMMITTEE, CONSERVATOR OR
RECEIVER, INCLUDING ONE WHO SUCCEEDS A LEGAL REPRESENTATIVE AND ONE
ACTING IN AN ANCILLARY CAPACITY THERETO IN ACCORDANCE WITH THE
PROVISIONS OF SUCH COURT APPOINTMENT.
5. AS USED IN THIS SECTION: (A) THE TERM "PERSON" INCLUDES AN INDIVID-
UAL, PARTNERSHIP, CORPORATION, ASSOCIATION OR ANY OTHER ORGANIZATION;
AND (B) THE TERM "CONTROL" MEANS THE POSSESSION, DIRECTLY OR INDIRECTLY,
OF THE POWER TO DIRECT OR CAUSE THE DIRECTION OF THE MANAGEMENT AND
POLICIES OF A LICENSEE, WHETHER THROUGH THE OWNERSHIP OF VOTING STOCK OF
SUCH LICENSEE, THE OWNERSHIP OF VOTING STOCK OF ANY PERSON WHICH
POSSESSES SUCH POWER OR OTHERWISE. CONTROL SHALL BE PRESUMED TO EXIST IF
S. 6688 5
ANY PERSON, DIRECTLY OR INDIRECTLY, OWNS, CONTROLS OR HOLDS WITH POWER
TO VOTE TEN PER CENTUM OR MORE OF THE VOTING STOCK OF ANY LICENSEE OR OF
ANY PERSON WHICH OWNS, CONTROLS OR HOLDS WITH POWER TO VOTE TEN PER
CENTUM OR MORE OF THE VOTING STOCK OF ANY LICENSEE, BUT NO PERSON SHALL
BE DEEMED TO CONTROL A LICENSEE SOLELY BY REASON OF BEING AN OFFICER OR
DIRECTOR OF SUCH LICENSEE OR PERSON. THE SUPERINTENDENT MAY IN HIS
DISCRETION, UPON THE APPLICATION OF A LICENSEE OR ANY PERSON WHO,
DIRECTLY OR INDIRECTLY, OWNS, CONTROLS OR HOLDS WITH POWER TO VOTE OR
SEEKS TO OWN, CONTROL OR HOLD WITH POWER TO VOTE ANY VOTING STOCK OF
SUCH LICENSEE, DETERMINE WHETHER OR NOT THE OWNERSHIP, CONTROL OR HOLD-
ING OF SUCH VOTING STOCK CONSTITUTES OR WOULD CONSTITUTE CONTROL OF SUCH
LICENSEE FOR PURPOSES OF THIS SECTION.
§ 363-G. GROUNDS FOR SUSPENSION OR REVOCATION. 1. THE SUPERINTENDENT
MAY SUSPEND OR REVOKE ANY LICENSE ISSUED UNDER THIS ARTICLE IF THE
SUPERINTENDENT SHALL FIND THAT:
(A) THE LICENSEE HAS FAILED TO PAY ANY SUM OF MONEY LAWFULLY DEMANDED
BY THE SUPERINTENDENT OR TO COMPLY WITH ANY DEMAND, RULING, OR REQUIRE-
MENT OF THE SUPERINTENDENT WITHIN A REASONABLE PERIOD OF TIME;
(B) THE LICENSEE HAS VIOLATED ANY PROVISIONS OF THIS ARTICLE; OR
(C) ANY FACT OR CONDITION EXISTS WHICH, IF IT HAD EXISTED AT THE TIME
OF THE ORIGINAL APPLICATION FOR SUCH LICENSE, CLEARLY WOULD HAVE
WARRANTED THE SUPERINTENDENT IN REFUSING ORIGINALLY TO ISSUE SUCH
LICENSE.
2. THE SUPERINTENDENT MAY ON GOOD CAUSE SHOWN, WITHOUT NOTICE OR HEAR-
ING, SUSPEND ANY LICENSE FOR A PERIOD NOT EXCEEDING THIRTY DAYS, PENDING
INVESTIGATION.
3. ANY LICENSEE MAY SURRENDER ANY LICENSE BY DELIVERING TO THE SUPER-
INTENDENT WRITTEN NOTICE THAT THE LICENSEE THEREBY SURRENDERS SUCH
LICENSE, BUT SUCH SURRENDER SHALL NOT AFFECT SUCH LICENSEE'S CIVIL OR
CRIMINAL LIABILITY FOR ACTS COMMITTED PRIOR TO SUCH SURRENDER.
4. NO REVOCATION OR SUSPENSION OR SURRENDER OF ANY LICENSE SHALL
IMPAIR OR AFFECT THE OBLIGATION OF ANY PRE-EXISTING LAWFUL CONTRACT
BETWEEN THE LICENSEE AND ANY BORROWER.
5. EVERY LICENSE ISSUED PURSUANT TO THIS ARTICLE SHALL REMAIN IN FORCE
AND EFFECT UNTIL IT SHALL HAVE BEEN SURRENDERED, REVOKED, OR SUSPENDED
IN ACCORDANCE WITH THE PROVISIONS OF THIS ARTICLE, BUT THE SUPERINTEN-
DENT SHALL HAVE AUTHORITY TO REINSTATE SUSPENDED LICENSES OR TO ISSUE
NEW LICENSES TO A LICENSEE WHOSE LICENSE OR LICENSES SHALL HAVE BEEN
REVOKED IF NO FACT OR CONDITION THEN EXISTS WHICH CLEARLY WOULD HAVE
WARRANTED THE SUPERINTENDENT IN REFUSING ORIGINALLY TO ISSUE SUCH
LICENSE UNDER THIS ARTICLE.
6. WHENEVER THE SUPERINTENDENT SHALL REVOKE OR SUSPEND A LICENSE
ISSUED PURSUANT TO THIS ARTICLE, THE SUPERINTENDENT SHALL EXECUTE A
WRITTEN ORDER TO THAT EFFECT. THE SUPERINTENDENT SHALL FILE ONE COPY OF
SUCH ORDER IN THE OFFICE OF THE DEPARTMENT AND SERVE A COPY UPON THE
LICENSEE, SUCH ORDER MAY BE REVIEWED IN THE MANNER PROVIDED BY ARTICLE
SEVENTY-EIGHT OF THE CIVIL PRACTICE LAW AND RULES. SUCH SPECIAL PROCEED-
ING FOR REVIEW AS AUTHORIZED BY THIS SECTION MUST BE COMMENCED WITHIN
THIRTY DAYS FROM THE DATE OF SUCH ORDER OF SUSPENSION OR REVOCATION.
§ 363-H. EXAMINATIONS. FOR THE PURPOSE OF DISCOVERING VIOLATIONS OF
THIS ARTICLE OR SECURING INFORMATION LAWFULLY REQUIRED UNDER THIS ARTI-
CLE, THE SUPERINTENDENT MAY AT ANY TIME, AND AS OFTEN AS MAY BE DETER-
MINED, EITHER PERSONALLY OR BY A PERSON DULY DESIGNATED BY THE SUPER-
INTENDENT, INVESTIGATE THE BUSINESS AND EXAMINE THE BOOKS, ACCOUNTS,
RECORDS, AND FILES USED THEREIN OF EVERY LICENSEE IN CONNECTION WITH THE
ACTIVITY COVERED UNDER THIS ARTICLE. FOR THAT PURPOSE THE SUPERINTENDENT
S. 6688 6
AND DULY DESIGNATED REPRESENTATIVES SHALL HAVE FREE ACCESS TO THE
OFFICES AND PLACE OF BUSINESS, BOOKS, ACCOUNTS, PAPERS, RECORDS, FILES,
SAFES AND VAULTS OF ALL SUCH LICENSEES. THE SUPERINTENDENT SHALL HAVE
AUTHORITY TO REQUIRE THE ATTENDANCE OF AND TO EXAMINE UNDER OATH ALL
PERSONS WHOSE TESTIMONY MAY BE REQUIRED RELATIVE TO SUCH BUSINESS.
§ 363-I. BOOKS AND RECORDS. 1. THE LICENSEE SHALL KEEP AND USE IN ITS
BUSINESS SUCH BOOKS, ACCOUNTS, AND RECORDS AS WILL ENABLE THE SUPER-
INTENDENT TO DETERMINE WHETHER SUCH LICENSEE IS COMPLYING WITH THE
PROVISIONS OF THIS ARTICLE AND WITH THE RULES AND REGULATIONS LAWFULLY
MADE BY THE SUPERINTENDENT PURSUANT TO THIS ARTICLE. EVERY LICENSEE
SHALL PRESERVE SUCH BOOKS, ACCOUNTS, AND RECORDS FOR AT LEAST TWO YEARS
AFTER THE LAST PAYMENT ON ANY ACCOUNT WAS MADE OR TWO YEARS AFTER AN
ACCOUNT IS WRITTEN OFF AS A LOSS. PRESERVATION OF PHOTOGRAPHIC REPROD-
UCTION THEREOF OR RECORDS IN PHOTOGRAPHIC FORM, INCLUDING AN OPTICAL
DISK STORAGE SYSTEM AND THE USE OF ELECTRONIC DATA PROCESSING EQUIPMENT
THAT PROVIDES COMPARABLE RECORDS TO THOSE OTHERWISE REQUIRED AND WHICH
ARE AVAILABLE FOR EXAMINATION UPON REQUEST SHALL CONSTITUTE COMPLIANCE
WITH THE REQUIREMENTS OF THIS SECTION.
2. EACH LICENSEE SHALL ANNUALLY ON OR BEFORE THE FIRST DAY OF APRIL
FILE A REPORT WITH THE SUPERINTENDENT GIVING SUCH INFORMATION AS THE
SUPERINTENDENT MAY REQUIRE CONCERNING THE BUSINESS AND OPERATIONS DURING
THE PRECEDING CALENDAR YEAR OF EACH LICENSED PLACE OF BUSINESS CONDUCTED
BY SUCH LICENSEE WITHIN THE STATE UNDER AUTHORITY OF THIS ARTICLE. SUCH
REPORT SHALL BE SUBSCRIBED AND AFFIRMED AS TRUE BY THE LICENSEE UNDER
THE PENALTIES OF PERJURY AND SHALL BE IN THE FORM PRESCRIBED BY THE
SUPERINTENDENT WHO SHALL MAKE AND PUBLISH ANNUALLY A CONSOLIDATED STATE-
MENT OF CONDITION SHOWING THE COMBINED ASSETS AND LIABILITIES OF ALL
LICENSED LENDERS. SUCH CONSOLIDATED STATEMENT OF CONDITION SHALL BE
BASED UPON THE INFORMATION CONTAINED IN SUCH REPORTS. IN ADDITION TO
ANNUAL REPORTS, THE SUPERINTENDENT MAY REQUIRE SUCH ADDITIONAL REGULAR
OR SPECIAL REPORTS AS MAY BE DEEMED NECESSARY TO THE PROPER SUPERVISION
OF LICENSEES UNDER THIS ARTICLE. SUCH ADDITIONAL REPORTS SHALL BE IN THE
FORM PRESCRIBED BY THE SUPERINTENDENT AND SHALL BE SUBSCRIBED AND
AFFIRMED AS TRUE UNDER THE PENALTIES OF PERJURY.
§ 363-J. ADVERTISING. 1. NO LICENSEE SHALL ADVERTISE, PRINT, DISPLAY,
PUBLISH, DISTRIBUTE, OR BROADCAST OR CAUSE OR PERMIT TO BE ADVERTISED,
PRINTED, DISPLAYED, PUBLISHED, DISTRIBUTED, OR BROADCASTED, IN ANY
MANNER WHATSOEVER ANY STATEMENT OR REPRESENTATION WITH REGARD TO THE
RATES, TERMS, COSTS OR CONDITIONS FOR A COMMERCIAL FINANCING PRODUCT
WHICH IS FALSE, MISLEADING OR DECEPTIVE.
2. NO LICENSEE SHALL MAKE, DIRECTLY OR INDIRECTLY, ORALLY OR IN WRIT-
ING, BY ANY METHOD, PRACTICE OR DEVICE, ANY REPRESENTATION THAT IT IS
LICENSED UNDER THIS ARTICLE, EXCEPT A REPRESENTATION THAT SUCH LICENSEE
IS LICENSED AS A LICENSED COMMERCIAL FINANCING PROVIDER BY THE DEPART-
MENT.
3. NO LICENSEE SHALL TRANSACT ANY BUSINESS SUBJECT TO THIS ARTICLE
UNDER ANY OTHER NAME OR AT ANY OTHER PLACE OF BUSINESS THAN THAT NAMED
IN THE LICENSE, EXCEPT AS MAY BE AUTHORIZED BY THE SUPERINTENDENT.
§ 363-K. PROHIBITED PRACTICES OF LICENSEES. 1. NO LICENSEE SHALL TAKE
ANY CONFESSION OF JUDGMENT OR ANY POWER OF ATTORNEY RUNNING TO HIMSELF
OR TO ANY THIRD PERSON TO CONFESS JUDGMENT OR TO APPEAR FOR THE BORROWER
IN A JUDICIAL PROCEEDING.
2. NO LICENSEE SHALL TAKE ANY INSTRUMENT IN WHICH BLANKS ARE LEFT TO
BE FILLED IN AFTER EXECUTION.
§ 363-L. PENALTIES. 1. ANY COMMERCIAL FINANCING PRODUCT MADE BY A
PERSON NOT LICENSED UNDER THIS ARTICLE, AND NOT EXEMPT, TO A BUSINESS OR
S. 6688 7
COMMERCIAL ENTERPRISE LOCATED IN THIS STATE SHALL BE VOID, AND THE
PROVIDER SHALL HAVE NO RIGHT TO COLLECT OR RECEIVE ANY PRINCIPAL, INTER-
EST, FEES OR CHARGES WHATSOEVER. NO ACTION TO ENFORCE A TRANSACTION MADE
IN VIOLATION OF THIS SUBDIVISION MAY BE MAINTAINED.
2. ANY PERSON OR OTHER ENTITY INCLUDING THE OFFICERS, DIRECTORS,
AGENTS, AND EMPLOYEES THEREOF, WHICH SHALL VIOLATE OR PARTICIPATE IN THE
VIOLATION OF ANY OF THE PROVISIONS OF SECTION THREE HUNDRED SIXTY-THREE
OF THIS ARTICLE SHALL BE GUILTY OF A MISDEMEANOR.
§ 363-M. REGULATIONS. THE SUPERINTENDENT IS HEREBY AUTHORIZED AND
EMPOWERED TO MAKE SUCH GENERAL RULES AND REGULATIONS, AND SUCH SPECIFIC
RULINGS, DEMANDS, AND FINDINGS AS MAY BE NECESSARY FOR THE PROPER
CONDUCT OF THE BUSINESS AUTHORIZED AND LICENSED UNDER AND FOR THE
ENFORCEMENT OF THIS ARTICLE, IN ADDITION HERETO AND NOT INCONSISTENT
HEREWITH.
§ 363-N. SEVERABILITY. IF ANY PROVISION OF THIS ARTICLE OR THE APPLI-
CATION THEREOF TO ANY PERSON OR CIRCUMSTANCES IS HELD TO BE INVALID,
SUCH INVALIDITY SHALL NOT AFFECT OTHER PROVISIONS OR APPLICATIONS OF
THIS ARTICLE WHICH CAN BE GIVEN EFFECT WITHOUT THE INVALID PROVISION OR
APPLICATION, AND TO THIS END THE PROVISIONS OF THIS ARTICLE ARE SEVERA-
BLE.
§ 2. Paragraph 5 of subdivision a of section 10-136 of the administra-
tive code of the city of New York, as added by local law number 80 of
the city of New York for the year 1996, is amended to read as follows:
(5) "Check cashing business" shall mean any person duly licensed by
the superintendent of banks to engage in the business of cashing checks,
drafts or money orders for consideration pursuant to the provisions of
article [9-A] 9-B of the banking law.
§ 3. Subdivision (a) of section 22 of the banking law, as amended by
chapter 553 of the laws of 2007, is amended to read as follows:
(a) Notwithstanding any other provision of law, every applicant for a
license, authorization or registration under articles nine, nine-A,
NINE-B, eleven-B, twelve-B, twelve-C, twelve-D, twelve-E and thirteen-B
of this chapter and every applicant filing an application to acquire
control of any licensee or registrant, as the case may be, under such
articles shall submit simultaneously with an application, his or her
fingerprints in such form and in such manner as specified by the divi-
sion of criminal justice services, but in any event, no less than two
digit imprints. The superintendent shall submit such fingerprints to the
division of criminal justice services for the purpose of conducting a
criminal history search and returning a report thereon in accordance
with the procedures and requirements established by the division pursu-
ant to the provisions of article thirty-five of the executive law, which
shall include the payment of the prescribed processing fees. The super-
intendent shall request that the division submit such fingerprints to
the federal bureau of investigation, together with the processing fees
prescribed by such bureau, for the purpose of conducting a criminal
history search and returning a report thereon. An applicant shall not be
required to submit his or her fingerprints as required by this subdivi-
sion if such applicant (i) is already subject to regulation by the
department and the applicant has submitted such fingerprints to the
department, such fingerprints have been submitted to the division of
criminal justice services for the purpose of conducting a criminal
history search, and a report of such search has been received by the
department from such division; or (ii) is subject to regulation by a
federal bank regulatory agency and has submitted such fingerprints to
such agency which has had a criminal history search conducted of such
S. 6688 8
individual and has shared such information or its determination result-
ing from such search with the department; or (iii) is an officer or
stockholder of a corporation whose common or preferred stock is regis-
tered on a national securities exchange, as provided in an act of
congress of the United States entitled the "Securities Exchange Act of
1934", approved June sixth, nineteen hundred thirty-four, as amended, or
such other exchange or market system as the superintendent shall approve
by regulation, and has submitted such fingerprints to such exchange or
market system which has had a criminal history search conducted of such
individual and has shared such information or its determination result-
ing from such search with the department; provided, however, that the
superintendent may subsequently require such applicant to submit his or
her fingerprints if the superintendent has a reasonable basis for updat-
ing the information or determination resulting from the report of the
criminal history search conducted at the request of such federal banking
agency, exchange or market system.
§ 4. Subdivision 2 of section 635 of the banking law, as amended by
chapter 146 of the laws of 2003, is amended to read as follows:
2. "License" when used in this article means any license duly issued
by the superintendent pursuant to the provisions of article nine,
nine-A, NINE-B, eleven-B, twelve-B, twelve-C, twelve-D or thirteen-B of
this chapter or any registration certificate issued by the superinten-
dent pursuant to the provisions of article twelve-D of this chapter.
§ 5. Subdivision 1 of section 652-b of the banking law, as added by
chapter 374 of the laws of 1979, is amended to read as follows:
1. It shall be unlawful for any transmitter of money or its officers,
affiliates or subsidiaries to enter into an agreement with a check cash-
er, licensed pursuant to the provisions of article [nine-A] NINE-B of
this chapter, whereby credit is extended to the check casher at the same
time as, and on the condition that, the transmitter of money enters into
an agreement with the check casher whereby the check casher will (1)
sell only the New York instruments or New York traveler's checks of the
transmitter of money or (2) agree to the exclusive use of any of the
other services of the transmitter of money. This section shall not
apply to the issuance by a transmitter of money of a guarantee of any
indebtedness of a check casher licensed pursuant to the provisions of
article [nine-A] NINE-B of this chapter.
§ 6. This act shall take effect on the one hundred eightieth day after
it shall have become a law. Effective immediately, any rules and regu-
lations necessary to implement the provisions of this act on its effec-
tive date are authorized to be amended, promulgated and/or repealed on
or before such date.
