Relates to increasing penalties for violations by unlicensed transmitters of money.
TITLE OF BILL: An act to amend the banking law, in relation to violations by unlicensed transmitters of money
PURPOSE: To raise the criminal penalties for unlicensed money transmitter activities in those situations where the person knows that the funds involved are the proceeds of criminal conduct
SUMMARY OF PROVISIONS: This bill amends Section 650(2) of the Banking Law to separate the current Class E felony penalties for the unlicensed transmission of money into two categories: 1) the existing violation regarding the unlicensed transmission of funds in excess of a specified threshold would continue to be a Class E felony; and 2) the existing violation regarding the unlicensed transmission of funds where the transmitter knows that such funds are the proceeds of any criminal conduct would be raised from a Class E felony to a Class D felony.
JUSTIFICATION: This bill would increase the criminal penalties for the unlicensed transmission of money in certain situations. The existing penalties were set in 1990. Under that law, it is a Class A misdemeanor to operate as an unlicensed money transmitter, with the penalty rising to a Class E felony if the transmitter either transmits more than a specified threshold amount or transmits money knowing that it is the proceeds of any criminal conduct.
It is important to have appropriate and significant penalties in order to help deter crime and to appropriately punish those who commit such crimes. There continues to be much attention at both the national and state levels to possible abuses involving money transmitters. In addition to the potential for consumer fraud, illegal money transmitters are often involved in laundering the proceeds of criminal activity. Some federal investigations have even focused on the use of money transmitters to launder funds in support of terrorist activities.
The regulation of the money transmission industry is important for protecting consumers and preventing criminal activities. Unlicensed transmitters seek to evade the regulatory system and are likely to be involved in such illegal activities. It is appropriate to target with higher penalties those illegal operators who are helping to facilitate criminal activities through the laundering of criminal proceeds.
FISCAL IMPLICATIONS: None
EFFECTIVE DATE: This act shall take effect on the sixtieth day after it shall have become law
STATE OF NEW YORK ________________________________________________________________________ 2931 2013-2014 Regular Sessions IN SENATE January 25, 2013 ___________Introduced by Sen. FARLEY -- 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 violations by unlicensed transmitters of money THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 2 of section 650 of the banking law, as amended by chapter 543 of the laws of 1990, is amended to read as follows: 2. a. Any person who either (1) engages in the business of receiving money for transmission or transmitting the same or (2) sells or issues New York instruments or New York traveler's checks as those terms are defined by section six hundred fifty-three of this chapter, without a license therefor obtained from the superintendent as provided in this article, shall be guilty of a
[Class]CLASS A misdemeanor. b. Any person who violates paragraph a of this subdivision and in the course of that violation: (1) knowingly receives or agrees to receive for transmission from one or more individuals a total of ten thousand dollars or more in a single transaction, a total of twenty-five thousand dollars or more during a period of thirty days or less, or a total of two hundred fifty thousand dollars or more during a period of one year or less; or (2) knowingly sells or issues New York instruments or New York travel- er's checks to one or more individuals totaling ten thousand dollars or more in a single transaction, a total of twenty-five thousand dollars or more during a period of thirty days or less, or a total of two hundred fifty thousand dollars or more during a period of one year or less SHALL BE GUILTY OF A CLASS E FELONY; [or (3)]C. ANY PERSON WHO VIOLATES THE PROVISIONS OF PARAGRAPH A OF THIS SUBDIVISION AND IN THE COURSE OF SUCH VIOLATION:EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD08150-01-3 S. 2931 2
(1) knowingly engages in the business of receiving money for transmit- ting or transmitting the same, knowing such money to be the proceeds of any criminal conduct; or
[(4)](2) knowingly sells or issues New York instruments or New York traveler's checks as those terms are defined by section six hundred fifty-three of this chapter, knowing such instruments or checks to be purchased with the proceeds of or derived from any criminal conduct; shall be guilty of a class [E]D felony. S 2. This act shall take effect on the sixtieth day after it shall have become a law.