S5488-2011 Actions

• Jan 4, 2012: REFERRED TO BANKS
• May 25, 2011: REFERRED TO BANKS

S5488-2011 Memo

BILL NUMBER:S5488

TITLE OF BILL:

An act
to amend the banking law, in relation to ATM safety

PURPOSE OF BILL:

The purpose of the bill is to improve compliance with banking law
Article II-AA while reducing the cost to the Banking Department of
examining ATM Facilities for compliance with the camera, videotape,
lighting, locking door, mirror and signage requirements.

SUMMARY OF PROVISIONS:

Section 1 of the bill makes a number of amendments to Section 75-g of
the banking law.

First, it amends subdivision 1 of Section 75-g to increase the number
of ATM compliance reports that must be filed by banking institutions
from 1 to 4 per year. It also requires such reports to be filed
electronically, unless the Superintendent waives the electronic
filing requirement for good cause shown.

It adds new Subdivision 1-a of Section 75-g, which requires a banking
institution whose quarterly compliance report indicated any failure
to comply with the ATM safety standards to file an additional
written report by the eleventh business day after the original
report, indicating whether each failure has been corrected. In
addition, for each failure that was not corrected within 10 business
days of the original report, the institution must report, promptly
after correcting the failure, the date of correction.

Section 2 of the bill amends the penalty provisions of Section 75-j of
the banking law to make clear that the obligation to correct
violations within 10 business days applies equally to each of the
quarterly compliance reports.

Section 3 of the bill provides that the amendments will become
effective on March 1 of the year following enactment, or such later
date as the Superintendent may determine is necessary for the
Department to develop a system for automated filing of quarterly
compliance reports.

EXISTING LAW:

Section 75-g of the banking law provides that banking institutions
must file a compliance report once a year. The current reports are
made in hard copy by mail.

Section 75-j of the banking law currently authorizes the Banking
Department to impose civil penalties after the banking institution
has been "found to be in violation," and the institution fails to
correct the violation within 10 business days. That section also


contains penalties for failure to file required reports or for filing
reports with inaccurate information or omissions.

PRIOR LEGISLATIVE HISTORY:

This is a new proposal. In both 2009 and 2010, the Banking Department
proposed, as part of a larger regulatory reform effort, legislation
that would have allowed the Banking Department by regulation to
require electronic filing of compliance reports, but the bill was not
passed.

STATEMENT IN SUPPORT:

The ATM Safety Act is very prescriptive in directing the Banking
Department on how to administer its provisions. Over time, the cost
of administering these provisions has increased. The Banking
Department has divided the state into 10 regions and has assigned
ATM Safety Inspectors to conduct inspections of ATM Facilities within
those regions, At least part of those inspections must occur at
night, since the inspection involves measuring whether the lighting
in the ATM facility meets the appropriate number of foot candles
required by the act's illuminance standards.

Over time, as banks have become more familiar with the standards,
instances of non-compliance have decreased. Consequently, the Banking
Department believes that its resources could beneficially be
reallocated to other pressing issues, without detracting from ATM
safety, if financial institutions were required to make the
appropriate inspections, take the appropriate measurements and report
the results to the Banking Department. Because the bill would
increase the number of compliance reports required of banking
institutions from one annual report to four quarterly reports, the
Banking Department believes that compliance with the ATM Safety Act's
standards could actually increase.

BUDGET IMPLICATIONS:

There are no budget implications from this bill.

EFFECTIVE DATE:

The bill would take effect on the March 1st next succeeding the
effective date of the bill or such later date as the superintendent
of banks may determine is necessary for the Banking Department to
develop a system for the automated reporting of compliance with the
requirements of article 2-AA of the banking law.

S5488-2011 Text

                      S T A T E   O F   N E W   Y O R K
  ________________________________________________________________________

                                    5488

                         2011-2012 Regular Sessions

                              I N  SENATE

                                May 25, 2011
                                 ___________

  Introduced  by Sen. MARCELLINO -- (at request of the Banking Department)
    -- read twice and ordered printed, and when printed to be committed to
    the Committee on Banks

  AN ACT to amend the banking law, in relation to ATM safety

    THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
  BLY, DO ENACT AS FOLLOWS:


    Section  1. Subdivision 1 of section 75-g of the banking law, as added
  by chapter 9 of the laws of 1996 and as designated  by  section  4-a  of
  part  A of chapter 57 of the laws of 1998, is amended and a new subdivi-
  sion 1-a is added to read as follows:

    1. [Within one year after the effective date of this article, and each
  year thereafter] BY THE FIFTEENTH DAY OF JANUARY, APRIL, JULY AND  OCTO-
  BER  EACH YEAR (OR THE FOLLOWING BUSINESS DAY IF SUCH DAY IS NOT A BUSI-
  NESS DAY), every banking institution which [has] HAD an automated teller
  machine facility which [is] WAS in operation on [such date and such date
  every year thereafter] THE FIFTEENTH DAY OF THE  PRECEDING  MONTH  shall
  submit  a  written  COMPLIANCE  report  to  the  department  on  a  form
  prescribed by the superintendent, certifying that such automated  teller
  machine facility is in compliance with the provisions of this article or
  any  variance or exemption that has been granted, or if such facility is
  not in compliance with such provisions, [such report shall state]  STAT-
  ING  the manner in which such facility fails to meet such requirements[,
  the reasons for such non-compliance and a plan to remedy any  such  non-
  compliance].   NOTWITHSTANDING ARTICLE THREE OF THE STATE TECHNOLOGY LAW
  OR ANY OTHER LAW TO THE CONTRARY, SUCH REPORTS  AND  ANY  OTHER  REPORTS
  REQUIRED  BY  THIS SECTION SHALL BE MADE BY ELECTRONIC MEANS, UNLESS THE
  SUPERINTENDENT, IN HIS OR HER SOLE DISCRETION, GRANTS A WAIVER  OF  SUCH
  ELECTRONIC FILING REQUIREMENT, UPON GOOD CAUSE SHOWN.
    1-A. IF ANY QUARTERLY COMPLIANCE REPORT REQUIRED BY SUBDIVISION ONE OF
  THIS  SECTION  INDICATES  ANY  FAILURE  TO MEET THE REQUIREMENTS OF THIS
  ARTICLE, SUCH BANKING INSTITUTION SHALL SUBMIT A WRITTEN REPORT  TO  THE

   EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                        [ ] is old law to be omitted.
                                                             LBD09433-02-1

 S. 5488                             2

  DEPARTMENT,  ON  A  FORM PRESCRIBED BY THE SUPERINTENDENT, NO LATER THAN
  THE ELEVENTH BUSINESS DAY FOLLOWING SUCH  QUARTERLY  COMPLIANCE  REPORT,
  INDICATING  WHETHER  EACH  SUCH  FAILURE HAS BEEN CORRECTED AND, FOR ANY
  FAILURE THAT HAS NOT BEEN CORRECTED, THE REASON FOR SUCH FAILURE AND THE
  EXPECTED  CORRECTION  DATE.  IF  ANY  SUCH  FAILURE  SHALL NOT HAVE BEEN
  CORRECTED WITHIN TEN BUSINESS DAYS OF THE FILING DATE OF THE  APPLICABLE
  QUARTERLY  COMPLIANCE  REPORT,  SUCH BANKING INSTITUTION SHALL, PROMPTLY
  AFTER CORRECTING SUCH FAILURE, SUBMIT A WRITTEN REPORT TO THE DEPARTMENT
  WITH THE DATE OR DATES OF EACH SUCH CORRECTION.
    S 2. Subdivision 1 of section 75-j of the banking law, as  amended  by
  section  11  of  part O of chapter 59 of the laws of 2006, is amended to
  read as follows:

    1. Any banking institution THAT REPORTS A VIOLATION OF  ANY  PROVISION
  OF  SECTION  SEVENTY-FIVE-C  OF  THIS  ARTICLE IN A QUARTERLY COMPLIANCE
  REPORT UNDER SECTION SEVENTY-FIVE-G OF  THIS  ARTICLE  OR  IS  OTHERWISE
  found  BY  THE DEPARTMENT to be in violation of any provision of section
  seventy-five-c of this article shall correct the  violation  within  ten
  business days after such REPORT OR finding.  Where a banking institution
  fails  to  correct  [said  violation  within  such  period  of time] ANY
  VIOLATION OF A PROVISION OF SECTION SEVENTY-FIVE-C OF THIS ARTICLE WITH-
  IN TEN BUSINESS DAYS AFTER THE FILING OF SUCH REPORT  OR  A  FINDING  OF
  VIOLATION  BY  THE  DEPARTMENT,  the superintendent may, in a proceeding
  after notice and a hearing, require [any] SUCH  banking  institution  to
  pay  a  civil  penalty  in  an  amount as determined pursuant to section
  forty-four of this chapter, provided, however, that the aggregate penal-
  ty for all offenses with respect to any  one  automated  teller  machine
  facility  in any one proceeding shall not exceed an amount as determined
  pursuant to section forty-four of this chapter. For the purposes of this
  article, each violation of section seventy-five-c of this article  shall
  be considered a separate and distinct violation.
    S  3. This act shall take effect on the first of March next succeeding
  the date on which it shall have become a law or such later date  as  the
  superintendent  of  banks  may  determine  is  necessary for the banking
  department to develop a system for the automated reporting of compliance
  with the requirements of article 2-AA of the banking law; provided  that
  the  superintendent  of banks shall notify the legislative bill drafting
  commission upon the development of such system of automated reporting in
  order that the commission may maintain an accurate and timely  effective
  data  base  of the official text of the laws of the state of New York in
  furtherance of effectuating the provisions of section 44 of the legisla-
  tive law and section 70-b of the public officers law.