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BILL NUMBER:S7690

TITLE OF BILL: An act to amend the general business law, in relation to the sale of abandoned property location services; and to amend the abandoned property law, in relation to restrictions on agreements to locate abandoned property

PURPOSE OR GENERAL IDEA OF BILL: The purpose of this bill is to ensure that consumers are able to make informed decisions regarding the purchase of abandoned property locations services by requiring such services to notify consumers that property held by the State may be obtained directly from the Office of the State Comptroller free of charge.

SUMMARY OF SPECIFIC PROVISIONS: This bill would amend the General Business Law to require any person or business entity offering abandoned property location services for a fee to include the following notice in all solicitations and agreements: "Abandoned funds held by the State can be obtained directly from the Office of the State Comptroller by the owner of such funds without paying a fee. These funds are held indefinitely by the Office of the State Comptroller. For more information, contact the Office of the State Comptroller at (current telephone number established by the Office for receiving inquires from consumers regarding unclaimed funds) or (current web address of the Office)."

This bill would also amend section 1416 of the Abandoned Property Law related to abandoned property location service agreements to:

> clarify that such section shall apply to any person, corporation, association, partnership or other entity which sells or offers to sell such services, with the exception of certain client agreements with attorneys or accountants; and

> provide that abandoned property location service agreements shall be in a form prescribed by the Comptroller and witnessed and acknowledged by a notary public.

JUSTIFICATION: According to the Better Business Bureau of Metro New York, several consumers have filed complaints regarding solicitations for abandoned property location services that make exaggerated claims, while others have complained about services making misleading claims. Some consumers informed the Bureau that they paid an upfront fee only to find that the State held less than three dollars of their money.

Rightful owners of unclaimed funds held by the State should be able to claim their funds without charge. In order to save New Yorkers' hard earned money, the Office of the State Comptroller encourages consumers to make direct inquires regarding unclaimed funds, as

 opposed to using an abandoned property location service that charges a fee.

Section one of the bill is modeled on General Business Law sections 393-c and d, which require entities that offer to obtain documents provided by government agencies at no charge or for a small fee, namely labor postings and certified copies of property deeds, to disclose such fact to consumers.

PRIOR LEGISLATIVE HISTORY: New bill.

FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None to the State.

EFFECTIVE DATE: This act shall take effect on the sixtieth day after it shall have became a law.

Text

STATE OF NEW YORK
________________________________________________________________________

7690

IN SENATE

June 13, 2012
___________

Introduced by Sen. FUSCHILLO -- read twice and ordered printed, and when
  printed to be committed to the Committee on Rules

AN  ACT  to  amend  the general business law, in relation to the sale of
  abandoned property location services; and to amend the abandoned prop-
  erty law, in relation to restrictions on agreements  to  locate  aban-
  doned property

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

  Section 1. The general business law is amended by adding a new section
393-e to read as follows:
  S 393-E. SALE OF ABANDONED PROPERTY  LOCATION  SERVICES.  1.  FOR  THE
PURPOSES  OF  THIS SECTION, "ABANDONED PROPERTY LOCATION SERVICES" SHALL
INCLUDE ANY SERVICE FOR A FEE PROVIDING ASSISTANCE TO CONSUMERS FOR  THE
PURPOSES  OF LOCATING AND/OR RETRIEVING PROPERTY HELD BY THE STATE COMP-
TROLLER PURSUANT TO THE ABANDONED PROPERTY LAW.
  2. ANY PERSON, CORPORATION, ASSOCIATION, PARTNERSHIP OR  OTHER  ENTITY
WHICH  SELLS  OR  OFFERS  TO  SELL  IN THIS STATE ANY ABANDONED PROPERTY
LOCATION SERVICES SHALL, IN EVERY SOLICITATION AND  AGREEMENT  FOR  SUCH
SERVICES,  PROVIDE  TO THE PURCHASER THE FOLLOWING NOTICE IN A CLEAR AND
CONSPICUOUS MANNER, AND IN AT LEAST TWELVE-POINT BOLDFACE TYPE PRIOR  TO
THE TIME OF SALE:
  "ABANDONED  FUNDS  HELD BY THE STATE CAN BE OBTAINED DIRECTLY FROM THE
OFFICE OF THE STATE COMPTROLLER BY  THE  OWNER  OF  SUCH  FUNDS  WITHOUT
PAYING  A  FEE.   THESE FUNDS ARE HELD INDEFINITELY BY THE OFFICE OF THE
STATE COMPTROLLER. FOR MORE INFORMATION, CONTACT THE OFFICE OF THE STATE
COMPTROLLER AT (INSERT THE CURRENT TELEPHONE NUMBER ESTABLISHED  BY  THE
OFFICE  OF  THE STATE COMPTROLLER FOR RECEIVING INQUIRIES FROM CONSUMERS
REGARDING UNCLAIMED FUNDS) OR (INSERT THE CURRENT ADDRESS OF THE WEBSITE
OF THE OFFICE OF THE STATE COMPTROLLER)."
  S 2. Section 1416 of the abandoned property law, as added  by  chapter
173 of the laws of 1980, is amended to read as follows:
  S  1416.  Restriction on agreement to locate AND/OR RETRIEVE abandoned
property. 1.   FOR THE PURPOSES OF  THIS  SECTION,  "ABANDONED  PROPERTY
LOCATION SERVICES" SHALL INCLUDE ANY SERVICE FOR A FEE PROVIDING ASSIST-

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD15824-01-2
S. 7690                             2

ANCE TO CONSUMERS FOR THE PURPOSES OF LOCATING AND/OR RETRIEVING PROPER-
TY HELD BY THE COMPTROLLER PURSUANT TO THIS CHAPTER.
  2.  THIS  SECTION SHALL APPLY TO ANY PERSON, CORPORATION, ASSOCIATION,
PARTNERSHIP OR OTHER ENTITY WHICH SELLS OR OFFERS TO SELL IN THIS  STATE
ABANDONED  PROPERTY  LOCATION  SERVICES;  PROVIDED,  HOWEVER,  THAT THIS
SECTION SHALL NOT APPLY TO A CLIENT'S  AGREEMENT  WITH  AN  ATTORNEY  OR
ACCOUNTANT WHERE:
  (A)  THE  SERVICES IN QUESTION CAN ONLY BE PERFORMED BY AN ATTORNEY OR
ACCOUNTANT; OR
  (B) THERE IS A  PRE-EXISTING  RELATIONSHIP  BETWEEN  THE  ATTORNEY  OR
ACCOUNTANT AND THE CLIENT; OR
  (C)  THE  AGREEMENT  RESULTS FROM AN EFFORT INITIATED BY THE CLIENT TO
ENGAGE THE ATTORNEY OR ACCOUNTANT.
  3. No agreement [to locate property held by the comptroller] FOR ABAN-
DONED PROPERTY LOCATION SERVICES pursuant to this chapter shall be valid
unless [that] SUCH agreement:
  (a) is:
  (I) IN SUCH FORM AS MAY BE PRESCRIBED BY THE COMPTROLLER;
  (II) in writing [and];
  (III) signed by the property owner; AND
  (IV) WITNESSED AND ACKNOWLEDGED BY A NOTARY PUBLIC;
  (b) discloses the nature of the property; [and]
  (c) discloses the name and address of the [holder] COMPTROLLER; AND
  (D) DISCLOSES, IN A CLEAR AND CONSPICUOUS  MANNER,  AND  IN  AT  LEAST
TWELVE-POINT BOLDFACE TYPE:
  "ABANDONED  FUNDS  HELD BY THE STATE CAN BE OBTAINED DIRECTLY FROM THE
OFFICE OF THE STATE COMPTROLLER BY  THE  OWNER  OF  SUCH  FUNDS  WITHOUT
PAYING  A  FEE.   THESE FUNDS ARE HELD INDEFINITELY BY THE OFFICE OF THE
STATE COMPTROLLER. FOR MORE INFORMATION, CONTACT THE OFFICE OF THE STATE
COMPTROLLER AT (INSERT THE CURRENT TELEPHONE NUMBER ESTABLISHED  BY  THE
OFFICE  OF  THE STATE COMPTROLLER FOR RECEIVING INQUIRIES FROM CONSUMERS
REGARDING UNCLAIMED FUNDS) OR (INSERT THE CURRENT ADDRESS OF THE WEBSITE
OF THE OFFICE OF THE STATE COMPTROLLER)".
  [2] 4.  No such agreement shall be valid if it provides for payment of
a fee in excess of fifteen percent of the value of recoverable property.
  [3] 5.  Nothing in this section shall be construed to prevent an owner
from asserting, at any time, that any agreement [to locate property held
by the comptroller] FOR ABANDONED PROPERTY LOCATION SERVICES is based on
an excessive or unjust consideration.
  S 3. This act shall take effect on the sixtieth  day  after  it  shall
have become a law.