§ 131. Prohibitions against encroachments upon certain powers of banks
and trust companies. 1. No person unauthorized by law shall subscribe to
or become a member of, or be in any way interested in any association,
institution or company formed or to be formed for the purpose of issuing
notes or other evidences of debt to be loaned or put in circulation as
money; nor shall any such person subscribe to or become in any way
interested in any bank or trust company or fund created or to be created
for the like purposes or either of them. No corporation, domestic or
foreign, other than a national bank or a federal reserve bank, unless
expressly authorized by the laws of this state, shall employ any part of
its property, or be in any way interested in any fund which shall be
employed for the purpose of receiving deposits, making discounts,
receiving for transmission or transmitting money in any manner
whatsoever, or issuing notes or other evidences of debt to be loaned or
put into circulation as money, except that a small business investment
company as defined in and operating pursuant to the provisions of an act
of congress entitled "Small Business Investment Act of 1958," may act as
depository or fiscal agent of the United States when so designated by
the secretary of the treasury without violating the provisions of this
section, except that a corporation duly licensed by the superintendent
under article thirteen-B of this chapter or therein expressly excepted
from the application of said article may engage in the business of
selling or issuing checks or the business of receiving money for
transmission or transmitting the same and except that services of an
agent or representative may be performed in connection with the
obligations of issuers where each such marketable obligation has a face
value of not less than one hundred thousand dollars. The discounting of
bills, notes or evidences of debt by a corporation organized solely for
the purpose of enabling producers of farm, dairy, horticultural or other
agricultural products or cooperative corporations of such producers to
avail themselves of the provisions of an act of congress approved March
fourth, nineteen hundred and twenty-three, known as the agricultural
credits act of nineteen hundred and twenty-three, same being subchapter
three of chapter seven of title twelve of the code of laws of the United
States as adopted by congress January third, nineteen hundred
thirty-five, and amendments thereto, where such discounting is solely in
connection with the rediscount of such bills, notes or evidences of debt
under the provisions of said act of congress shall not be deemed or
construed to be a form of banking, nor shall the making of such
discounts be deemed to violate any provisions of law pertaining to
banking. Except as otherwise provided in article twelve-D of this
chapter, engaging in the business of loaning money in this state on
bonds, notes or other evidences of indebtedness, secured by deeds of
trust or mortgages upon real property or personal property situated in,
upon or appurtenant thereto, and/or purchasing of or otherwise acquiring
existing bonds, notes or other evidences of indebtedness, deeds of trust
or mortgages of or upon such properties, or any interest therein, and
the holding of the same, or the endorsing, selling, assigning,
transferring or disposing of the same to another corporation, by a
domestic business corporation, or by a foreign corporation which is
authorized to transact business in this state, shall not be deemed or
construed to violate any of the provisions of this chapter. The purchase
or other acquisition on original issue or subsequent transfer for less
than the principal amount thereof or otherwise at a discount of any
evidences of indebtedness or other obligations for the payment of money
shall not by reason of such discount be or be deemed to be a violation
of the provisions of this section.

2. No person, association of persons or corporation, unless expressly
authorized by law, shall keep any office for the purpose of issuing any
evidences of debt, to be loaned or put in circulation as money; nor
shall they issue any bills or promissory notes or other evidences of
debt for the purpose of loaning them or putting them in circulation as
money, unless thereto specially authorized by law.

3. Except as otherwise provided in article five or article five-C of
this chapter or subdivision four of this section, no corporation other
than a trust company shall have or exercise in this state the power of
receiving deposits of money, securities or other personal property from
any person or corporation in trust, or have or exercise in this state
any of the powers specified in section one hundred of this article, or
have or maintain an office in this state for the transaction of, or
transact, directly or indirectly, any such or similar business, except
that a federal reserve bank may exercise the powers conferred by
subdivision one of such section if authorized so to do by the laws of
the United States and any domestic corporation legally exercising any of
the powers conferred by such subdivision at the time this act takes
effect may continue to exercise such powers, and a foreign banking
corporation or trust company incorporated under the laws of another
state, which by the law of the state of its incorporation may act as
trustee, guardian, executor, administrator, or in any other fiduciary
capacity under any last will and testament or codicil thereto or other
testamentary writing or under any deed of trust inter vivos or other
written instrument establishing a trust, or by the appointment of any
court of said state, may act in this state in any such fiduciary
capacity, provided similar domestic corporations which have the power
under the law of this state to act herein in any such fiduciary
capacity, are permitted to act in like fiduciary capacity in the state
where such foreign corporation has its domicile, provided that if such
foreign corporation proposes to act in any fiduciary capacity in this
state and to do so is required to file its qualification in the
surrogate's court of this state, it shall file in the office of the
clerk of the surrogate's court of the county in which application for
such appointment is pending (a) a duly executed instrument in writing,
by its terms of indefinite duration and irrevocable, appointing such
clerk and his or her successors its true and lawful attorney, upon whom
all process in any action or proceeding against such fiduciary,
affecting or relating to the state, trust or fund represented or held by
such fiduciary or the acts of defaults of such corporation in reference
to such estate, trust or fund may be served with the same force and
effect as if it were a domestic corporation and had been lawfully served
with process within the state, and (b) a copy of its charter certified
by its secretary under its corporate seal, together with the post office
address of its principal office; provided further that if such foreign
corporation proposes to act in any other fiduciary capacity in the
state, it shall file in the office of the superintendent (a) a duly
executed instrument in writing, by its terms of indefinite duration and
irrevocable, appointing the superintendent and his or her successors its
true and lawful attorney, upon whom all process in any action or
proceeding against such fiduciary affecting or relating to the estate,
trust or fund held or represented by such fiduciary or the acts or
defaults of such corporation in reference to such estate, trust or fund
may be served with the same force and effect as if it were a domestic
corporation and had been lawfully served with process within the state,
(b) a written certificate of designation, which may be changed from time
to time thereafter by the filing of a new certificate of designation,
specifying the name and address of the officer, agent, or other person
to whom such process shall be forwarded by the superintendent, and (c) a
copy of its charter certified by its secretary under its corporate seal,
together with the post office address of its principal office.

4. (a) Except as otherwise provided in article five or article five-C
of this chapter, no foreign corporation, having authority to act in this
state as trustee, guardian, executor, administrator, or in any other
fiduciary capacity shall establish or maintain, directly or indirectly,
any branch office or agency in this state.

(b) Notwithstanding any other provisions of this chapter, a bank or
trust company incorporated under the laws of another state, which is
authorized by its charter and by the laws of the state of its
incorporation to exercise in such state any or all of the fiduciary
powers that trust companies are authorized to exercise in this state
pursuant to sections one hundred, one hundred-a, one hundred-b, one
hundred-c and one hundred-d of this article, may establish and maintain
a trust office in this state for purposes of exercising any or all of
the fiduciary powers authorized by the laws of the state of its
incorporation; provided, however, that (i) such trust office is not its
principal office; (ii) such exercise does not exceed the powers
authorized under sections one hundred, one hundred-a, one hundred-b, one
hundred-c and one hundred-d of this article; and (iii) a bank or trust
company organized under the laws of this state and authorized to
exercise any or all fiduciary powers under sections one hundred, one
hundred-a, one hundred-b, one hundred-c and one hundred-d of this
article is permitted to establish a trust office and exercise
substantially similar fiduciary powers on substantially the same basis
as permitted an out-of-state state bank or trust company pursuant to
this subdivision, in the state where such out-of-state state bank or
trust company is so incorporated. A trust office established or
maintained by such an out-of-state state bank or trust company pursuant
to this subdivision shall not be considered to be a branch office
pursuant to any other provisions of this chapter.

(c) An out-of-state state bank or trust company seeking to establish
and maintain a trust office or open any additional trust offices in this
state shall file a notice with the superintendent in the form prescribed
by the superintendent describing the proposed activities of the office
and such other information as the superintendent shall request. The
trust office may commence operation thirty days after the superintendent
receives such notice, unless the superintendent notifies the
out-of-state state bank or trust company in writing within such time
period that such office may not commence operation or that additional
information or time is required for the superintendent to consider such
notice.

(d) Such out-of-state state bank or trust company may establish and
maintain additional trust offices in this state pursuant to and
consistent with the provisions of this subdivision, provided that the
superintendent finds that the establishment and maintenance of any and
all trust offices by such out-of-state state bank or trust company is
and continues to be consistent with the goals set forth in the
declaration of policy contained in section ten of this chapter. The
superintendent shall have the power at any time in his or her discretion
to examine any trust office established pursuant to this section to the
same extent as is provided for in the case of banking organizations
pursuant to the provisions of this chapter. If any such foreign
corporation or out-of-state state bank or trust company violates this
provision, such foreign corporation or out-of-state state bank or trust
company shall not thereafter be appointed or act in any such fiduciary
capacity in this state. The validity of any mortgage heretofore given by
a foreign corporation to a trust company doing business within a foreign
domicile of such mortgagor to secure the payment of an issue of bonds
shall not be affected by any of the provisions of this section and such
mortgage shall be enforceable in accordance with the laws of this state
against property covered thereby within the state of New York.

5. Any out-of-state state bank or trust company subject to the
provision of subdivision three or four of this section may be either in
corporate form or organized as a limited liability company.

6. Every person, and every corporation, director, agent, officer or
member thereof, who shall violate any provision of this section,
directly or indirectly or assent to such violation, shall forfeit an
amount as determined pursuant to section forty-four of this chapter to
the people of the state.