§ 9-y. Order of payment of checks and other debits, insufficient funds
charges and return deposit item charges. 1. Order of paying checks. (a)
Notwithstanding any law, rule or regulation to the contrary, every
banking organization that provides checking services to consumer
accounts shall either pay checks in the order wherein they are received
or pay checks from smallest to largest dollar amount for each business
day's transactions.

(b) If a check is dishonored for insufficient funds and thereafter
smaller checks which could be paid are received, the smaller checks
shall be honored within amounts on deposit in the subject account.

(c) The banking organization shall disclose to consumers in writing
the order in which checks are drawn. The written disclosure shall be
provided to the consumer at the time the account is opened and prior to
any change in such policy.

(d) The superintendent shall promulgate rules and regulations
necessary for the implementation of this section.

2. Regulation of other consumer account transactions and associated
fees. (a) The superintendent shall have the power to prescribe by
regulation:

i. the manner in which banking organizations process debit and credit
transactions, other than those specified in subdivision one of this
section, for consumer accounts maintained at such organization;

ii. the charges that may be imposed in connection with a check drawn
or other written order upon, or electronic transfer sought to be
effectuated against, insufficient funds or uncollected balances in a
consumer account, whether or not the banking organization pays such
check, written order, or electronic transfer;

iii. the charges that may be imposed in connection with a check or
other written order received by a banking organization for deposit or
collection drawn against a consumer account and subsequently dishonored
and returned for any reason by the drawee;

iv. disclosures provided to consumers regarding the processing of
transactions in a consumer account and the associated fees; and

v. alerts, notices, and other disclosures relating to the imposition
or possible imposition of a charge as provided in subparagraphs ii and
iii of this paragraph.

(b) In prescribing regulations regarding the manner in which banking
organizations process debit or credit transactions, or the charges that
may be imposed pursuant to subparagraphs ii or iii of paragraph (a) of
this subdivision, the superintendent shall consider, at a minimum, the
following factors:

i. the cost incurred by the banking organization, in providing any
services associated with such charges;

ii. the competitive position of the banking organization; and

iii. the maintenance of a safe and sound banking organization that
protects the public interest.

3. Definition. As used in this section, "consumer accounts" means
accounts at banking organizations established by natural persons
primarily for personal, family or household purposes.