§ 258. Prohibition of unauthorized savings banks and use of the word
"savings"; exception as to school savings. 1. No individual,
partnership, unincorporated association or corporation other than a
savings bank, state or federal chartered savings and loan association,
bank, trust company, industrial bank, private banker, national bank,
foreign banking corporation licensed pursuant to this chapter to
transact in this state the business of receiving deposits or state and
federal chartered credit unions shall make use of the word "saving" or
"savings" or their equivalent in its banking or financial business, or
use any advertisement containing the word "saving" or "savings", or
their equivalent in relation to its banking or financial business, nor
shall any individual or corporation other than a savings bank in any way
solicit or receive deposits as a savings bank; but nothing herein shall
be construed to prohibit the use of the word "savings" in the name of
the Savings and Loan Bank of the State of New York or in the name of a
trust company all of the stock of which is owned by not less than twenty
savings banks. Any bank, trust company, industrial bank, private banker,
national bank, foreign banking corporation, state or federal chartered
credit unions, individual, partnership, unincorporated association or
corporation violating this provision shall forfeit to the people of the
state for every offense the sum of one hundred dollars for every day
such offense shall be continued.

2. Any school in the state of New York may collect from time to time
amounts of money from the pupils of such school and any philanthropic
agency incorporated for philanthropic purposes, if such agency be so
authorized by certificate of the superintendent of financial services,
may collect from time to time amounts of money from the children or
persons under the direction or guidance of, or the promotion of whose
welfare is an object of, such philanthropic agency. As to each such
school, such money shall be collected by or under the supervision of,
the principal or superintendent of such school or by, or under the
supervision of, any person designated for that purpose by the board of
education or other authority having jurisdiction over such school. As to
each such philanthropic agency, such money shall be collected by, or
under the supervision of, the superintendent or other designated head of
such agency. All money so collected shall, not later than the day
following the day of collection, be deposited in some savings bank in
the state, be used for the purchase of shares in any savings and loan
association organized under this law, or under the laws of the United
States, whose principal office is located in the state of New York, or
be deposited in any trust company or state or national bank located in
the state and having an interest department. All money so collected from
any person shall be deposited, or used to purchase shares, in his name;
provided, however, that if the principal, superintendent, designated
person or agency head by whom, or under whose supervision, such money
was collected shall deem the amount of money so collected at any one
time to be insufficient for the opening of individual accounts, such
money shall be deposited, or used to purchase shares, in the name of
such principal, superintendent, designated person or agency head, in
trust, to be by him eventually transferred to the credit of the
respective persons to whom the same belongs, and pending such transfer,
said principal, superintendent, designated person or agency head shall
furnish to the depositary institution or savings and loan association
receiving such money the name, signature, address, age and place of
birth of each person from whom such money was collected, and such other
data concerning such person as the institution may require. Any
depositary institution or savings and loan association authorized to
receive any amounts collected by a school or philanthropic agency in
accordance with this subdivision, may, on the request of any person
authorized by this subdivision to collect such amounts for such school
or philanthropic agency, send a collector to such school or
philanthropic agency to receive and receipt for same. Any certificate of
authorization issued to a philanthropic agency by the superintendent of
financial services in accordance with this subdivision shall specify the
period for which such authorization is to be effective and the area in
which collections may be made, and may specify any other terms or
conditions upon which such authorization is granted. Any such
authorization may be terminated by the superintendent of financial
services by written notice served upon the philanthropic agency or
mailed to it at its last known address. As used in this subdivision with
reference to the placing of amounts with a depositary institution or
savings and loan association, the words "the day following the day of
collection" shall mean the next day, after the day of collection, on
which such institution or association is open for business. As used in
this subdivision, the words "philanthropic agency" shall be deemed to
include, without limitation a corporation, not organized for profit,
engaged in promoting the welfare of seamen.

3. Money, deposited pursuant to the provisions of subdivision two of
this section and held by such banking organizations in the name of such
principal, superintendent, designated person or agency head in a school
district in a city having a population of more than one million, and
under whose custodial authority said money has remained for a period of
thirty years may be used by such a school district to establish a trust
fund after due and diligent effort by such principal, superintendent,
designated person, or agency head to locate and notify any such persons
entitled to receive such property. The income of said trust fund shall
be used to provide college scholarships to disadvantaged youth on a
competitive basis pursuant to rules promulgated by the board of
education of said district provided however that such scholarships shall
not exceed the cost of attendance. Any person or persons entitled to
receive such property shall be reimbursed from funds held in trust
pursuant to this subdivision. A bank shall not be liable as a result of
action taken under the provisions of this subdivision. Furthermore, no
banking organization acting on the instructions of or otherwise dealing
with any such principal, superintendent, designated person or agency
head shall be responsible for determining whether any such person is
acting in accordance with this section or is obliged to inquire into the
validity or propriety of the actions or instructions executed by any
such person or is bound to see to the application of any funds.