S T A T E   O F   N E W   Y O R K
 ________________________________________________________________________
 
                                   4125
 
                        2023-2024 Regular Sessions
 
                           I N  A S S E M B L Y
 
                             February 9, 2023
                                ___________
 
 Introduced  by  M.  of  A.  CUNNINGHAM  -- read once and referred to the
   Committee on Banks
 
 AN ACT to amend the banking law, in relation to prohibiting bank invest-
   ments in bad faith landlords
 
   THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
 BLY, DO ENACT AS FOLLOWS:

   Section  1.  The  banking law is amended by adding a new section 13 to
 read as follows:
   § 13. INVESTMENTS IN BAD FAITH LANDLORDS BY  STATE  CHARTERED  BANKING
 INSTITUTIONS.  1.  NO  STATE CHARTERED BANKING INSTITUTION SHALL PROVIDE
 FINANCING FOR OR INVEST IN THE STOCKS, SECURITIES, OR OTHER  OBLIGATIONS
 OF  ANY PERSON, INSTITUTION, COMPANY, OR SUBSIDIARY ENGAGED IN THE BUSI-
 NESS OF LEASING RESIDENTIAL REAL ESTATE THAT HAS:
   (A) BEEN CONVICTED OF ENGAGING IN ILLEGAL CONDUCT  AGAINST  A  TENANT,
 INCLUDING (I) HARASSMENT, (II) COERCION, OR (III) FRAUD;
   (B)  BEEN  CONVICTED  OF  FRAUDULENT  REFINANCING OF LOANS, TAX FRAUD,
 EMBEZZLEMENT, OR OTHER FRAUD OR THEFT RELATED TO  FINANCIAL  MANAGEMENT;
 OR
   (C)  ENTERED  INTO  A  CONSENT  DECREE WITH THE OFFICE OF THE ATTORNEY
 GENERAL IN SETTLEMENT OF A LAWSUIT REGARDING UNFAIR OR  DECEPTIVE  PRAC-
 TICES  AGAINST A TENANT, THAT (I) ESTABLISHES A TENANT RESTITUTION FUND,
 PURSUANT TO SUBDIVISION TWELVE OF SECTION SIXTY-THREE OF  THE  EXECUTIVE
 LAW,  WITH  TOTAL  CONTRIBUTIONS  IN EXCESS OF ONE MILLION DOLLARS, (II)
 RESULTS IN AN INDEPENDENT  PROPERTY  MANAGEMENT  COMPANY  ACQUIRING  THE
 PRIMARY  MANAGEMENT  RESPONSIBILITIES OF ANY OF THE RESPONDENT'S PROPER-
 TIES, OR (III) REQUIRES A  MONITOR  TO  ENGAGE  IN  THE  REVIEW  OF  THE
 RESPONDENT'S  COMPLIANCE  WITH  THE  POLICIES  AND  PROVISIONS OF SUCH A
 DECREE.
   2. FOR PURPOSES OF THIS SECTION:
   (A) "STATE CHARTERED BANKING INSTITUTION" SHALL HAVE THE SAME  MEANING
 AS DEFINED IN SUBDIVISION ONE OF SECTION TWELVE-A OF THIS ARTICLE;
 
  EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                       [ ] is old law to be omitted.
                                                            LBD07614-01-3
              

 A. 4125                             2
 
   (B) "CONSENT DECREE" SHALL MEAN AN AGREEMENT BETWEEN THE PARTIES IN AN
 ACTION TO RESOLVE THE ACTION, WHICH IS ENTERED, APPROVED, AND ORDERED BY
 A COURT;
   (C)  "TENANT RESTITUTION FUND" SHALL MEAN A FUND, TRUST, OR ACCOUNT IN
 WHICH MONEY IS DEPOSITED FOR THE  BENEFIT  OF  POTENTIAL  CLAIMANTS  WHO
 QUALIFY FOR RESTITUTIONS UNDER THE COURT ACTION THAT LED TO THE CREATION
 OF  THE  TENANT  RESTITUTION FUND AND THE OFFICE OF THE ATTORNEY GENERAL
 SHALL HAVE OVERSIGHT OF THE FUND AND BE RESPONSIBLE FOR MAKING  DISTRIB-
 UTIONS TO CLAIMANTS;
   (D)  "PROPERTY  MANAGEMENT  COMPANY"  SHALL MEAN A COMPANY THAT IS NOT
 OWNED BY A PARTY TO THE CONSENT DECREE THAT IS QUALIFIED TO  MANAGE  THE
 PROPERTIES THAT ARE SUBJECT TO A CONSENT DECREE; AND
   (E)  "MONITOR"  SHALL  MEAN AN INDIVIDUAL WHO HAS BEEN APPROVED BY THE
 OFFICE OF THE ATTORNEY GENERAL TO REVIEW AND REPORT ON WHETHER THE OTHER
 PARTY TO THE CONSENT  DECREE  AND/OR  THE  PROPERTY  MANAGEMENT  COMPANY
 COMPLY WITH THE POLICIES AND PROVISIONS OF THE CONSENT DECREE.
   §  2.  This  act  shall take effect immediately and shall apply to all
 contracts entered into, renewed, modified or amended on  or  after  such
 effective date.