Bill S5463-2011

Relates to restrictions on employees of the banking department, collecting assessment fees, suspending mortgage bankers; repealer

Relates to restrictions on employees of the banking department, collecting assessment fees, suspending mortgage bankers and brokers for cause and eliminating outdated language and provisions; relates to interest rate increases on mortgage loans after default.

Details

  • Versions
  • Sponsor:
  • Multi-sponsor(s):
  • Co-sponsor(s):
  • Committee:
  • Law Section:
  • Law:

Actions

  • Jun 13, 2012: referred to banks
  • Jun 13, 2012: DELIVERED TO ASSEMBLY
  • Jun 13, 2012: PASSED SENATE
  • Jun 13, 2012: ORDERED TO THIRD READING CAL.1208
  • Jun 13, 2012: COMMITTEE DISCHARGED AND COMMITTED TO RULES
  • Jan 4, 2012: REFERRED TO BANKS
  • Jan 4, 2012: returned to senate
  • Jan 4, 2012: died in assembly
  • Jun 14, 2011: referred to banks
  • Jun 14, 2011: DELIVERED TO ASSEMBLY
  • Jun 14, 2011: PASSED SENATE
  • Jun 6, 2011: ADVANCED TO THIRD READING
  • Jun 2, 2011: 2ND REPORT CAL.
  • Jun 1, 2011: 1ST REPORT CAL.905
  • May 24, 2011: REFERRED TO BANKS

Meetings

Calendars

Votes

VOTE: COMMITTEE VOTE: - Banks - Jun 1, 2011
Ayes (18): Griffo, Farley, Bonacic, DeFrancisco, Gallivan, Golden, Johnson, O'Mara, Marcellino, Ranzenhofer, Smith, Breslin, Carlucci, Diaz, Krueger, Rivera, Savino, Valesky
Ayes W/R (1): Kruger
VOTE: COMMITTEE VOTE: - Rules - Jun 13, 2012
Ayes (23): Skelos, Alesi, Farley, Fuschillo, Johnson, Larkin, LaValle, Libous, Marcellino, Maziarz, Nozzolio, Saland, Seward, Sampson, Breslin, Dilan, Duane, Hassell-Thompson, Montgomery, Parker, Perkins, Smith, Stewart-Cousins
Ayes W/R (1): Hannon
Excused (1): Krueger

Memo

BILL NUMBER:S5463

TITLE OF BILL: An act to amend the banking law, in relation to restrictions on employees of the banking department, collecting assessments and fees, suspending mortgage bankers and brokers for cause and eliminating outdated language and provisions; to amend the real property law, in relation to interest rate increases on mortgage loans after default and to repeal certain provisions of the banking law relating thereto

PURPOSE OF BILL:

This bill would make various technical and clarifying amendments to the Banking Law and the Real Property Law.

SUMMARY OF PROVISIONS:

This bill makes a number of amendments that clarify, correct or modernize various provisions in the Banking Law ("BL"), and one amendment to the section of the Real Property Law governing late charges on certain mortgage loans.

Section 1 of the bill amends BL § 14-d(7) to clarify the institutions to which the subdivision applies.

Section 2 of the bill amends BL § 22 with respect to the Superintendent's authority to require that applicants be fingerprinted. It also corrects the numbering of the subdivisions in the section. It also authorizes the Superintendent to update a criminal background check done by another entity if it is more than five years old, and makes provision for a federal criminal history report to be obtained other than through the DCJS (e.g. through the NMLS under Article 12-E).

Section 3 of the bill amends BL § 23 to authorize the Department to retain investigation fees paid even if a certificate of organization is not "filed."

Section 4 of the bill amends BL § 24 to clarify that extension of the 90 day period for the examination and approval of an organization certificate is within the sole discretion of the Superintendent. There are also a number of amendments to make the section gender-neutral. The amendment in BL § 24(3) is not intended to have substantive effect, since the requirements for approval appear elsewhere in this Article. Finally, a missing reference to BL § 136 is added to BL §24(4).

Section 5 of the bill amends BL § 25(1) and (3) with respect to the approval of authorization certificates. Several of the changes are to make references to the Superintendent gender-neutral. Another amendment increases from 60 to 90 days the discretion of the

Superintendent to extend the time period in which to issue the authorization certificate, where the applicant needs the time to raise capital or fulfill other conditions precedent to starting business. The amendment also authorizes the Superintendent to extend the time period for longer than 90 days where he or she determines th,at "extraordinary circumstances" exist. Similarly, the amendment to BL § 25(3) clarifies that the Superintendent may grant more than a single extension of time for the applicant to commence business.

Sections 6, 7 and 8 of the bill make amendments to BL §§ 28, 28-a and 28-b, respectively. The first two amendments are designed to make references to the Superintendent gender-neutral. In addition, BL 28-b(2), which concerned an outdated committee created by its enacting legislation, is deleted.

Section 9 of the bill amends BL § 28-b(5) to delete superfluous language.

Section 10 of the bill adds a new BL § 36-b. This section clarifies how records required by other sections of the Banking Law may be preserved, including by electronic storage media, and sets forth criteria for electronic storage.

Section 11 of the bill amends BL § 42 to allow the Superintendent to modify the notice provisions otherwise contained in the section, where the public interest will be served.

Section 12 of the bill amends BL § 229 to eliminate a reference to a section of law which has been repealed.

Section 13 of the bill amends BL § 413 to delete the reference to BL 142-b which has been repealed.

Section 14 of the bill amends BL § 460(2) to delete a reference to section 458 which has been repealed.

Section 15 of the bill amends BL § 4002 consistent with the changes to BL § 22 described above. Also, a limited exception to the requirement that fingerprint reviews be completed before an approval is granted by the Superintendent is added for the limited situation where a proposed entity has a surplus of incorporators.

Section 16 of the bill amends BL § 5004(8) to delete the references to sections that have been repealed.

Section 17 of the bill amends BL § 591 (1) (b) to make the fingerprint requirements of Article 12-D consistent with those of BL . 22.

Section 18 of the bill amends BL § 592(1) to delete unnecessary verbiage. Section 595(8) already addresses the issues covered by the deleted language.

Section 19 of the bill amends BL § 592-a to correct a reference from "licensee" to "registrant" and to delete unnecessary verbiage as in the case of Section 592(1).

Section 20 of the bill amends subdivisions 1,2,4, 4-a, 5, 6 and 7-a of BL § 595 and adds a new Subdivision 3. Subdivision 2 extends the suspension period from 30 to 90 days, and adds to the list of violations for which a suspension may be imposed without a hearing, those set forth in paragraphs (b) and (c). New Subdivision 3 clarifies when any such suspended license or registration may be reinstated; otherwise, the license or registration will terminate by operation of law after 90 days. Conforming changes are made to the other amended subdivisions.

Section 21 of the bill amends Real Property Law § 254-b, which currently prohibits "late charges" in excess of 2 percent of the delinquent installment, so that it explicitly bars interest rate increases on loans secured by residential homes and cooperative apartments arising from a default (e.g. a "default interest rate").

Section 22 of the bill amends BL 9001-a consistent with the amendments to BL §§ 22 and 4002. Also, a limited exception to the requirement that fingerprint reviews be completed before an approval is granted by the Superintendent is added for the limited situation where a proposed entity has a surplus of incorporators.

Sections 23 to 38 make similar changes to various recordkeeping provisions in the Banking Law. These changes also modernize and conform the recordkeeping requirements applicable to regulated entities to make them consistent with the amendments to BL § 36-b.

Section 39 of the bill provides for the effective date of the bill.

EXISTING LAW:

The Banking Law currently contains many outdated references and much outdated language. Numerous sections on recordkeeping authorize preservation of photographic records but do not mention electronic recordkeeping. In addition, recordkeeping obligations of sales finance companies and money transmitters are provided in regulations rather than by statute. Also, the ability of the Superintendent to suspend a license or registration are now limited under Banking Law 595. The Real Property Law permits certain late fees in times of default, but its provisions have been subject to misinterpretation.

PRIOR LEGISLATIVE HISTORY: This proposal was originally introduced in 2009 and 2010. The bill passed the Senate in 2010 but not the Assembly.

STATEMENT IN SUPPORT:

This bill would demonstrate the ongoing commitment of New York to update its statutory framework for the regulation of entities subject to its jurisdiction. The vast majority of the changes remove outdated references and make other non-substantive changes in the Banking Law to reflect the environment within which financial services now operate.

In addition, the following substantive changes would be made:

BL § 42 contains the requirements for publication of certain information on the Department's bulletin board (now electronic). On the rare occasion when approval of an application or order is time sensitive, publication of a notice under BL § 42 is not feasible or cannot be done consistent with Banking Law § 36(10). The proposed amendment to Banking Law § 42 would allow the Superintendent to vary or waive notice periods under that section as long as he or she determines that consideration of the matter is in the public interest and such waiver is necessary because of unusual and extraordinary circumstances.

BL § 595 sets forth the circumstances under which the Department can suspend the license or registration of a mortgage banker or mortgage broker. In dealing with licensed financial service providers, including mortgage bankers and brokers, during the recent subprime mortgage and credit crisis, the Department has determined that the current Banking Law provisions for suspensions and revocations of licenses or registrations do not provide sufficient flexibility and are unnecessarily costly. Most provisions of the Banking Law governing the suspension of non-banking entities limit the Superintendent's ability to suspend a license to 30 days and require a hearing to revoke a license. Thus, as a practical matter, the Superintendent must simultaneously issue an order of suspension and schedule a revocation hearing. Moreover, licensed entities often ask for time to hire counsel and prepare for a hearing and therefore request postponement of the hearing. Consequently, the proposed amendment would extend to 90 days the Superintendent's authority to suspend a license of a mortgage banker or the registration of a mortgage broker for cause, as defined in the Banking Law.

As a result of the current state budget crisis, the Department has analyzed areas where it believes it is incurring needless expense. One such area is in holding revocation hearings for non-bank licensed financial services providers, in this case mortgage bankers and brokers, who have violated certain key legal obligations and where there is no defense in the statute and where hearings are unnecessarily costly, especially because the respondent often does not appear at the hearing. The proposed amendments to BL § 595 would eliminate the need for such hearings in' the case of the mortgage bankers and brokers.

The amendment to BL § 25 would increase, from 60 days to 90 days, the discretion of the Superintendent to extend the time period in which to issue an authorization certificate, where the applicant needs the time to raise capital or fulfill other conditions precedent to starting a business. The amendment also authorizes the Superintendent to extend the time period for longer than 90 days where he or she determines that "extraordinary circumstances" exist. The first amendment would give start-up banks a longer period of time in which to complete their "launch" activities.

The amendments to the Real Property Law would remove any confusion over whether a lender could increase the interest rate on a loan in addition to charging late fees in default situations. While the Department believes that increasing the interest rate in such situations is not currently permissible, some institutions have reached a contrary conclusion based on their interpretation of the

wording of the statute. The instant amendment would eliminate any such confusion.

BUDGET IMPLICATIONS:

There are no budget implications from this bill.

EFFECTIVE DATE:

The bill would take effect immediately upon enactment, provided that section 21 of the bill will apply only to loans made after the effective date of the bill, and sections 28 and 33 will take effect on the 60th day after the effective date of the bill.


Text

STATE OF NEW YORK ________________________________________________________________________ 5463 2011-2012 Regular Sessions IN SENATE May 24, 2011 ___________
Introduced by Sen. GRIFFO -- (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 restrictions on employ- ees of the banking department, collecting assessments and fees, suspending mortgage bankers and brokers for cause and eliminating outdated language and provisions; to amend the real property law, in relation to interest rate increases on mortgage loans after default and to repeal certain provisions of the banking law relating thereto THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 7 of section 14-d of the banking law, as added by chapter 234 of the laws of 1983, is amended to read as follows: 7. In this section "banking institution" has the same meaning ascribed to it by section [nine-f] NINE-K of this chapter and "item" has the same meaning ascribed to it by the uniform commercial code. S 2. Section 22 of the banking law, as amended by chapter 553 of the laws of 2007, is amended to read as follows: S 22. Fingerprints. [(a)] 1. Notwithstanding any other provision of law, every applicant for a license, authorization or registration under articles nine, nine-A, eleven-B, twelve-B, twelve-C, twelve-D, twelve-E and thirteen-B of this chapter and every applicant filing an application to acquire control of any licensee or registrant, as the case may be, under such articles shall submit [simultaneously with an application,] his or her fingerprints in such form and in such manner as specified by the division of criminal justice services OR THE SUPERINTENDENT, AS APPROPRIATE, but in any event, no less than two digit imprints. The superintendent shall submit such fingerprints to the division of crimi- nal justice services for the purpose of conducting a criminal history search and returning a report thereon in accordance with the procedures and requirements established by the division pursuant to the provisions
of article thirty-five of the executive law, which shall include the payment of the prescribed processing fees. The superintendent shall request that the division submit such fingerprints to the federal bureau of investigation, together with the processing fees prescribed by such bureau, for the purpose of conducting a criminal history search and returning a report thereon UNLESS THE SUPERINTENDENT HAS MADE OTHER ARRANGEMENTS FOR SUCH SUBMISSION. An applicant shall not be required to submit his or her fingerprints as required by this subdivision if such applicant (i) is already subject to regulation by the department and the applicant has submitted such fingerprints to the department, such fing- erprints have been submitted to the division of criminal justice services for the purpose of conducting a criminal history search, and a report of such search has been received by the department from such division WITHIN THE PAST FIVE YEARS; or (ii) is subject to regulation by a federal bank regulatory agency and has submitted such fingerprints to such agency which has had a criminal history search conducted of such individual and has shared such information or its determination result- ing from such search with the department WITHIN THE PAST FIVE YEARS; or (iii) is an officer or stockholder of a corporation whose common or preferred stock is registered on a national securities exchange, as provided in an act of congress of the United States entitled the "Secu- rities Exchange Act of 1934", [approved June sixth, nineteen hundred thirty-four, as amended,] or such other exchange or market system as the superintendent shall approve by regulation, and has submitted such fing- erprints to such exchange or market system which has had a criminal history search conducted of such individual and has shared such informa- tion or its determination resulting from such search with the department WITHIN THE PAST FIVE YEARS; provided, however, that the superintendent may subsequently require such applicant to submit his or her finger- prints if the superintendent has a reasonable basis for updating the information or determination resulting from the report of the criminal history search conducted at the request of such federal banking agency, exchange or market system. [(b)] 2. The superintendent [shall] MAY also, concurrent with an investigation of a licensee or registrant, or an authorized individual, pertaining to a violation of this chapter, submit such fingerprints to the division of criminal justice services for the purpose of conducting a criminal history search and returning a report thereon and through the division to the federal bureau of investigation for the purpose of a fingerprint check of such licensee, registrant or authorized individual. [(c)] 3. For purposes of this section, "applicant" shall include a natural person or such principal, officer, director, trustee or stock- holder of any other entity as may be designated by the superintendent. Notwithstanding any other provision of this article, the superintendent shall not access criminal history data or information, unless any agency from which the superintendent receives directly criminal history data or information has entered into a use and dissemination agreement with the superintendent consistent with the provisions of this section. S 3. The second undesignated paragraph of section 23 of the banking law, as amended by section 5 of part O of chapter 59 of the laws of 2006, is amended to read as follows: At the time of submission of the certificate and accompanying docu- ments an investigation fee as prescribed pursuant to section eighteen-a of this article shall be paid to the superintendent[, to be retained by him or her if the certificate and accompanying documents are filed. If the certificate and accompanying documents are not filed because of
defects therein, the investigation fee is to be returned with such papers to the persons from whom they were received]
. S 4. Section 24 of the banking law, as amended by chapter 684 of the laws of 1938, subdivision 1 as amended by chapter 453 of the laws of 1960, subdivision 2 as amended by chapter 419 of the laws of 1996, subdivision 3 as amended by chapter 52 of the laws of 1944 and subdivi- sion 4 as amended by chapter 608 of the laws of 1996, is amended to read as follows: S 24. Investigation by superintendent; refusal or approval; filing certificate. 1. Within ninety days after the date when any organization certificate or private banker's certificate shall have been filed for examination, the superintendent, if he OR SHE shall find after investi- gation and examination of what he OR SHE deems to be the best sources of information [at his command] AVAILABLE that the character, responsibil- ity and general fitness of the person or persons named in such certif- icate are such as to command confidence and warrant belief that the business of the proposed corporation or private banker will be honestly and efficiently conducted in accordance with the intent and purpose of this chapter, and that the public convenience and advantage will be promoted by allowing such proposed corporation or private banker to engage in business, shall [submit] APPROVE such certificate [to the banking board together with all papers, correspondence and other infor- mation in his possession relating thereto, including the results of his investigation and his recommendation in the matter]. [Such] AN EXTENSION OF SUCH NINETY DAY period [of ninety days] may be [extended] REQUESTED, by a written [consent] REQUEST executed by a majority of the persons from whom the superintendent received such organization certificate or private banker's certificate, for such additional reasonable period of time as may be required for applicants to comply with conditions prece- dent stipulated by the superintendent as being a prerequisite to his [recommendation to the banking board] OR HER APPROVAL. THE SUPERINTEN- DENT, IN HIS OR HER SOLE DISCRETION, SHALL DETERMINE WHETHER TO GRANT SUCH AN EXTENSION. 2. [If three-fifths of the members of the board, after consideration of all relevant information available to them, shall vote for approval, the] THE superintendent[, if he is still satisfied, upon the consider- ations set forth in subdivision one of this section, that such proposed corporation or private banker should be permitted to engage in busi- ness,] shall [approve such certificate and] ALSO endorse upon each of the duplicates the date of such approval. [He] THE SUPERINTENDENT shall forthwith cause notice of such approval to be given to the proposed incorporators or private banker and one of the duplicate certificates [to] SHALL be filed in the office of the department and the other in the office of the clerk of the county in which the principal office of such proposed corporation or private banker is to be located. In a case in which a private banker certificate is submitted to the superintendent for the purpose of continuing the business in connection with a change in its partnership, the superintendent shall approve the private banker certificate [without any action by the banking board] upon making a determination that the private banker should be permitted to continue its business based upon the considerations set forth in subdivision one of this section. 3. If [three-fifths of the members of the banking board shall not vote for approval, or if] the superintendent[, either prior or subsequent to the submission of such certificate to the board,] is not satisfied, upon the considerations set forth in subdivision one of this section, that
such proposed corporation or private banker should be permitted to engage in business, the superintendent shall refuse such certificate and shall endorse thereon the date of such refusal and return one of the duplicates to the proposed incorporators or private banker from whom such certificate was received. 4. The provisions of this section shall not apply to any organization certificate required to be filed in the office of the superintendent by SECTION ONE HUNDRED THIRTY-SIX, BY section two hundred sixty-b, by section four hundred ten, by section four hundred eleven or by section four hundred eighty-six of this chapter. S 5. Subdivisions 1 and 3 of section 25 of the banking law, subdivi- sion 1 as amended by chapter 512 of the laws of 1977 and subdivision 3 as amended by chapter 561 of the laws of 1946, are amended to read as follows: 1. If the superintendent shall find that a corporation or private banker, the certificate of which has been approved and filed as provided in section twenty-four of this article, has in good faith complied with all the requirements of law and fulfilled all the conditions precedent to commencing business imposed by this chapter, [he] THE SUPERINTENDENT shall, within ninety days after the date of such approval, [or within such longer period thereafter as he may permit pursuant to the second sentence of this subdivision,] but in no case after the expiration of that period, issue [under his hand] and EXECUTE UNDER the official seal of the department, in triplicate, an authorization certificate to the person or persons named in such organization certificate or private banker's certificate. [The] NOTWITHSTANDING THE PRECEDING SENTENCE, IF THE SUPERINTENDENT DETERMINES IT IS CONSISTENT WITH THE DECLARATION OF POLICY CONTAINED IN SECTION TEN OF THIS ARTICLE, THE superintendent may extend the period within which he OR SHE may issue the authorization certificate by (I) an additional [sixty] NINETY days, provided, however, that he OR SHE shall have determined that such extension of time is needed for raising capital, for fulfilling any other condition precedent to the commencement of business or for satisfying any other requirement of organization, whether imposed by statute or regulation[, and that such extension is consistent with the declaration of policy contained in section ten of this chapter] OR OTHERWISE, OR (II) SUCH LONGER PERIOD OF TIME HE OR SHE SHALL DEEM APPROPRIATE, PROVIDED, HOWEVER, THAT HE OR SHE SHALL HAVE DETERMINED THAT EXTRAORDINARY CIRCUMSTANCES EXIST. Such authorization certificate shall state that the corporation or private banker named therein has complied with the provisions of this chapter and that it is authorized to transact the business specified therein. Such authorization certificate shall be conclusive evidence that all conditions precedent have been fulfilled and that the corporation has been formed under this chapter, except in an action or special proceed- ing brought by the superintendent or the attorney general. The super- intendent shall cause one of the triplicate authorization certificates to be transmitted to the corporation or private banker thereby author- ized to commence business, another to be filed in the office of the department, and the third to be filed in the county clerk's office in which the organization certificate or the private banker's certificate has been filed. The copies of the authorization certificate filed in the offices of the superintendent and the county clerk shall be attached to the copies of the organization certificate or private banker's certif- icate previously filed and such certificates shall be recorded in the records of incorporation therein.
3. Any corporation which shall not commence business within six months after the date on which its authorization certificate is issued by the superintendent shall forfeit its rights and privileges as a corporation and its corporate powers shall cease and determine unless the time with- in which such business may be commenced has been extended by the super- intendent. Upon satisfactory cause being shown, the superintendent may grant [an extension for a period of not more than one year] ONE OR MORE EXTENSIONS. Such extension shall be granted by order executed, transmit- ted and filed in the manner provided for an authorization certificate in subdivision one of this section. S 6. Section 28 of the banking law, as amended by chapter 315 of the laws of 2008, is amended to read as follows: S 28. Change of location; change of designation of principal office; approval or refusal; certificate. Upon receipt by the superintendent of a written application in proper form from any banking organization or foreign corporation for leave to change its place or one of its places of business to another place or from any banking organization for leave to change the designation of its principal office to a branch office and to change the designation of one of its branch offices to its principal office, the superintendent shall, if he or she shall be satisfied that such change may be permitted under the terms of this chapter and that there is no reasonable objection to such change, execute and issue a certificate under the official seal of the department authorizing such change and specifying the date on or after which such change may be made, and shall cause the original of such certificate to be transmitted to the applicant, a copy to be filed in the office of the department and a copy to be filed in the office of the clerk of the county in which the principal office of the applicant is located, provided that if the proposed principal office is in a different county than the county in which the principal office is located at the time of the filing of the application, the superintendent shall cause copies to be filed in the offices of the clerks of both counties. If the superintendent shall [be satisfied in any case that such change is undesirable or inexpedient, he or she shall] refuse such application [and], HE OR SHE SHALL notify the applicant of such determination. S 7. Section 28-a of the banking law, as amended by section 6 of part O of chapter 59 of the laws of 2006, is amended to read as follows: S 28-a. Temporary change of location; approval or refusal; certif- icate. Notwithstanding any provisions of law limiting the number of offices which may be maintained thereby, any banking organization or foreign banking corporation may make a written application to the super- intendent for a temporary change of location of its authorized place or one of its authorized places of business or a portion thereof to another place within the state which shall be as near as practicable to such authorized place of business. At the time of making the application an investigation fee as prescribed pursuant to section eighteen-a of this article shall be paid to the superintendent for each temporary location for which leave to open is sought, except where (1) the applicant would not be required to pay an investigation fee upon the filing of an appli- cation for a change of location under provisions of this chapter other than this section, or (2) said application is necessitated by damage or destruction caused by flood, tidal wave, earthquake, conflagration, tornado, hurricane, cyclone, windstorm or other storm or such other event as shall have been declared a catastrophe by the superintendent. If there is no reasonable objection to such change, and if the super- intendent finds that such change is necessary or desirable during a
period of construction, repair, alteration, improvement, or recon- struction of the previously authorized place of business, he or she shall issue AND EXECUTE a certificate under [his or her hand and] the official seal of the department authorizing each such change and speci- fying (a) the period during which such temporary location may be main- tained, (b) the date on or after which such change may be made, and (c) the powers which may be exercised thereat. The superintendent shall cause the original of such certificate to be transmitted to the appli- cant, a copy to be filed in the office of the department and a copy to be filed in the office of the clerk of the county in which the principal office of the applicant is located. If the superintendent shall [be satisfied in any case that a change is undesirable or inexpedient, he or she shall] refuse such application [and], HE OR SHE SHALL notify the applicant of [his or her] SUCH determination. A temporary place of busi- ness occupied pursuant to the provisions of this section shall be closed as soon as practicable, and in no event later than the date specified in its authorization certificate, unless the superintendent shall have extended such time. The banking organization or corporation shall notify the superintendent in writing prior to such closing as to the date it intends to close the temporary place of business. S 8. Subdivision 2 of section 28-b of the banking law is REPEALED. S 9. Subdivision 5 of section 28-b of the banking law, as added by chapter 361 of the laws of 1984, is amended to read as follows: 5. The [banking board] SUPERINTENDENT is hereby authorized and empowered[, by a three-fifths vote of all its members,] to promulgate rules and regulations effectuating the provisions of this section, including any rules and regulations providing that the assessment of banking institutions referred to in subdivision three of this section shall be made on a graduated numerical basis. S 10. The banking law is amended by adding a new section 36-b to read as follows: S 36-B. PRESERVATION OF BOOKS AND RECORDS. WHEN ANY PROVISION OF THIS CHAPTER OR ANY RULE OR REGULATION ADOPTED PURSUANT THERETO REQUIRES THAT BOOKS AND RECORDS BE PRESERVED, SUCH REQUIREMENT MAY BE SATISFIED BY MAINTENANCE OF ORIGINAL PAPERS OR OTHER RECORDS, PHOTOGRAPHIC REPROD- UCTIONS, OR RECORDS STORED IN ELECTRONIC STORAGE MEDIA. AS USED IN THIS CHAPTER, "ELECTRONIC STORAGE MEDIA" MEANS ANY DIGITAL STORAGE MEDIUM OR SYSTEM THAT MEETS THE FOLLOWING CONDITIONS: 1. IT MUST PRESERVE THE RECORDS EXCLUSIVELY IN NON-REWRITABLE, NON-ERASABLE FORMAT; 2. IT MUST VERIFY AUTOMATICALLY THE QUALITY AND ACCURACY OF THE STOR- AGE MEDIA RECORDING PROCESS; 3. IT MUST HAVE THE CAPACITY TO READILY DOWNLOAD INDEXES AND RECORDS PRESERVED ON THE ELECTRONIC STORAGE MEDIA TO ANY MEDIUM ACCEPTABLE TO THE SUPERINTENDENT; AND 4. IT MUST BE IMMEDIATELY READABLE ON EQUIPMENT AT ALL TIMES AVAIL- ABLE TO THE SUPERINTENDENT FOR EXAMINATION OF SUCH RECORDS. S 11. The closing paragraph of section 42 of the banking law, as amended by chapter 684 of the laws of 1938, is amended to read as follows: NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THIS SECTION, THE SUPER- INTENDENT MAY VARY OR WAIVE ANY SUCH PUBLICATION REQUIREMENTS, IF HE OR SHE SHALL DETERMINE THAT SUCH VARIATION OR WAIVER IS NECESSARY BECAUSE OF UNUSUAL AND EXTRAORDINARY CIRCUMSTANCES AND CONSIDERATION OF THE MATTER IS IN THE PUBLIC INTEREST. Every such statement after having been so posted for one week shall be placed on file and kept in the office of
the department. All such statements shall be public documents and at all reasonable times shall be open to public inspection. S 12. Subdivision 1 of section 229 of the banking law, as amended by chapter 1 of the laws of 1984, is amended to read as follows: 1. This article applies to every savings bank and shall not apply to any other banking organization except to such extent, if any, as may be specified in any article of this chapter governing such banking organ- ization; provided, however, that in the case of stock-form savings banks, this article applies to every such organization except that the [banking board] SUPERINTENDENT, consistent with the declaration of poli- cy described in section fourteen-e of this chapter, shall be empowered to deem inapplicable to stock-form savings banks, sections two hundred thirty, [two hundred thirty-one,] two hundred thirty-two, two hundred thirty-three, subdivisions one and two of section two hundred thirty- four, two hundred forty-three, two hundred forty-four, two hundred forty-five, two hundred forty-six, two hundred forty-six-a, two hundred forty-seven, two hundred forty-eight, two hundred forty-nine, two hundred fifty, two hundred fifty-one and two hundred fifty-two of this chapter. S 13. Subdivision 1 of section 413 of the banking law, as amended by chapter 300 of the laws of 1994, is amended to read as follows: 1. With the prior approval of the superintendent, a New York savings and loan holding company or a subsidiary thereof or a New York savings association may acquire control of an out-of-state savings and loan holding company or an out-of-state savings association, and an out-of- state savings and loan holding company or a subsidiary thereof or an out-of-state savings association may acquire control of a New York savings and loan holding company or a New York savings association subject to regulations to be adopted by the [banking board] SUPERINTEN- DENT. [The terms and conditions prescribed by such regulations shall be substantially similar to those contained in section one hundred forty- two-b of this chapter governing reciprocal interstate acquisitions by bank holding companies.] S 14. Subdivision 2 of section 460 of the banking law, as added by chapter 608 of the laws of 1996, is amended to read as follows: 2. Earnings from all sources for the period for which a dividend is to be paid[, except as provided in section four hundred fifty-eight of this article,] may be credited to the profit and loss account of the credit union and the following items shall be charged against such account in the determination of the amount available for dividends to shareholders: (a) All expenses paid or incurred by the credit union in the manage- ment of its affairs, the collection of its debts or the transaction of its business. (b) The interest paid or accrued on debts owed by the credit union. (c) All losses incurred on loans in excess of the allowance for loan loss account. (d) Any interest collected in advance shall be considered unearned at the end of the fiscal period, and shall be set aside in an account called "unearned interest". The credit balance of the profit and loss account as thus determined shall constitute the undivided profits of the credit union at the close of such period, and shall be applicable to the payment of dividends except as provided in subdivision three of this section. S 15. Section 4002 of the banking law, as added by chapter 321 of the laws of 1992, subdivision (a) as amended by chapter 217 of the laws of
2010, subdivision (b) as amended and subdivision (d) as added by chapter 302 of the laws of 2003, is amended to read as follows: S 4002. Fingerprints. [(a)] 1. Notwithstanding any other provisions of law, every incorporator of a corporation shall, in addition to any other requirements which may be imposed by the superintendent, submit simultaneously with an application, his or her fingerprints in such form and in such manner as specified by the division of criminal justice services, but in any event, no less than two digit imprints. Every applicant filing an application to acquire control of any banking insti- tution under sections one hundred forty-three-a and one hundred forty- three-b of this chapter shall, in addition to any other requirements which may be imposed by the superintendent, submit simultaneously with an application, his or her fingerprints in such form and in such manner as specified by the division of criminal justice services, but in any event, no less than two digit imprints. The superintendent shall submit the fingerprints to the division of criminal justice services for the purpose of conducting a criminal history search and returning a report thereon in accordance with the procedures and requirements established by the division pursuant to the provisions of article thirty-five of the executive law, which shall include the payment of the prescribed proc- essing fees. The superintendent shall request that the division submit such fingerprints to the federal bureau of investigation, together with the processing fees prescribed by such bureau, for the purpose of conducting a criminal history search and returning a report thereon. [(b)] 2. The superintendent [shall] MAY also, concurrent with an investigation of an incorporator of a corporation pertaining to a violation of this chapter, submit such fingerprints to the division of criminal justice services for the purpose of conducting a criminal history search and returning a report thereon and through the division to the federal bureau of investigation for the purpose of a fingerprint check of such incorporator. [(c)] 3. For purposes of this section, ["incorporator"] "APPLICANT" SHALL INCLUDE AN INCORPORATOR AND shall include a natural person or such principal, officer, director, trustee or stockholder of any other entity as may be designated by the superintendent. Notwithstanding any other provision of this article, the superintendent shall not access criminal history data or information, unless any agency from which the super- intendent receives directly criminal history data or information has entered into a use and dissemination agreement with the superintendent consistent with the provisions of this section. [(d)] 4. An applicant shall not be required to submit his or her fing- erprints as required by subdivision [(a)] ONE of this section if such applicant (i) is already subject to regulation by the department and the applicant has submitted such fingerprints to the department, such fing- erprints have been submitted to the division of criminal justice services for the purpose of conducting a criminal history search, and a report of such search has been received by the department from such division WITHIN THE PAST FIVE YEARS; or (ii) is subject to regulation by a federal bank regulatory agency and has submitted such fingerprints to such agency which has had a criminal history search conducted of such individual and has shared such information or its determination result- ing from such search with the department WITHIN THE PAST FIVE YEARS; or (iii) is an officer or stockholder of a corporation whose common or preferred stock is registered on a national securities exchange, as provided in an act of congress of the United States entitled the "Secu- rities Exchange Act of 1934", [approved June sixth, nineteen hundred
thirty-four, as amended,]
or such other exchange or market system as the superintendent shall approve by regulation, and has submitted such fing- erprints to such exchange or market system which has had a criminal history search conducted of such individual and has shared such informa- tion or its determination resulting from such search with the department WITHIN THE PAST FIVE YEARS; provided, however, that the superintendent may subsequently require such applicant to submit sets of fingerprints if the superintendent has a reasonable basis for updating the informa- tion or determination resulting from the report of the criminal history search conducted at the request of such federal banking agency, exchange or market system. 5. WHENEVER AN INCORPORATOR HAS TIMELY FILED HIS OR HER FINGERPRINTS AS REQUIRED BY THIS SECTION, BUT: (I) THE SUPERINTENDENT HAS NOT RECEIVED A REPORT OF THE RESULTS OF A RELATED CRIMINAL HISTORY SEARCH; (II) THE CIRCUMSTANCES WARRANT AN EXPEDITIOUS DETERMINATION; AND (III) THE SUPERINTENDENT DETERMINES, AFTER CONSIDERING ALL AVAILABLE INFORMA- TION, THAT THE REMAINING INCORPORATORS ARE ADEQUATE IN NUMBER AND HAVE THE CHARACTER, RESPONSIBILITY AND GENERAL FITNESS SO AS TO WARRANT BELIEF THAT, EVEN IF SUCH PERSON WERE NOT TO SERVE AS AN INCORPORATOR, SUCH BUSINESS WILL BE HONESTLY AND EFFICIENTLY OPERATED, THE SUPERINTEN- DENT MAY WAIVE THE REQUIREMENT FOR RECEIPT OF SUCH REPORT PRIOR TO APPROVAL, SUBJECT TO RECEIPT FROM SUCH INCORPORATOR OF HIS OR HER WRIT- TEN AGREEMENT TO RESIGN IMMEDIATELY FROM ALL POSITIONS HELD WITH SUCH ENTITY IF SUCH REPORT DEMONSTRATES, IN THE SOLE DISCRETION OF THE SUPER- INTENDENT, THAT THE INCORPORATOR LACKS THE NECESSARY CHARACTER, RESPON- SIBILITY AND FITNESS. S 16. Subdivision 8 of section 5004 of the banking law, as added by chapter 849 of the laws of 1964, is amended to read as follows: 8. When the consideration for shares has been paid in full, the subscriber shall be entitled to all the rights and privileges of a hold- er of such shares and to a certificate representing his shares, and such shares shall be fully paid and, subject to sections [one hundred thir- teen-a, one hundred thirteen-b,] one hundred fourteen[, three hundred five, three hundred five-a, three hundred six, three hundred twenty-two, three hundred twenty-two-a] and three hundred twenty-three of this chap- ter, shall be nonassessable. S 17. Paragraph (b) of subdivision 1 of section 591 of the banking law, as amended by chapter 164 of the laws of 2003, is amended to read as follows: (b) [The] AS PROVIDED IN SECTION TWENTY-TWO OF THIS CHAPTER, THE fing- erprints of the applicant[, which may be submitted to the division of criminal justice services and the federal bureau of investigation for state and national criminal history record checks]; S 18. Subdivision 1 of section 592 of the banking law, as amended by chapter 400 of the laws of 1993, is amended to read as follows: 1. Upon the filing of an application for a license, if the superinten- dent shall find that the financial responsibility, experience, charac- ter, and general fitness of the applicant and of the members thereof if the applicant is a co-partnership or association, and of the officers and directors thereof if the applicant is a corporation are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly, and efficiently within the purpose of this article, the superintendent shall thereupon issue a license in duplicate to engage in the business of making mortgage loans described in section five hundred ninety of this article in accordance with provisions of this article. If the superintendent shall not so
find, the superintendent shall not issue such license, and the super- intendent shall notify the applicant of the denial. The superintendent shall transmit one copy of such license to the applicant and file anoth- er in the office of the banking department. Upon receipt of such license, a mortgage banker shall be authorized to engage in the business of making mortgage loans in accordance with the provisions of this arti- cle. [Such license shall remain in full force and effect until it is surrendered by the licensee or revoked or suspended as hereinafter provided.] The superintendent shall approve or deny every application for license hereunder within ninety days from the filing of a completed application provided, however, that failure to act within the prescribed period shall not be deemed approval of any such application. S 19. Subdivision 1 of section 592-a of the banking law, as amended by section 18 of part D-1 of chapter 109 of the laws of 2006, is amended to read as follows: 1. Upon the filing of an application for registration, if the super- intendent shall find that the financial responsibility, experience, character, and general fitness of the applicant, and of the members thereof if the applicant is a co-partnership or association, and of the officers and directors thereof if the applicant is a corporation, are such as to command the confidence of the community and to warrant belief that the business will be operated honestly, fairly, and efficiently within the purpose of this article, the superintendent shall thereupon register the applicant as a mortgage broker on a roll maintained for that purpose at the banking department, and issue a certificate attest- ing to such registration in duplicate. If the superintendent shall not so find, the superintendent shall not register such applicant, and shall notify the applicant of the denial. The superintendent shall transmit one copy of such certificate to the applicant and file another in the office of the banking department. Upon receipt of such certificate a mortgage broker shall be authorized to engage in the business of [plac- ing] SOLICITING, processing [and], PLACING, OR negotiating mortgage loans. [Such registration shall remain in full force and effect until it is surrendered by the licensee or revoked or suspended as hereinafter provided, except that such registration, notwithstanding any provisions of subdivision five of section seventeen of this chapter to the contra- ry, shall expire upon the registrant's failure to pay the required assessment charged pursuant to such section seventeen thirty days after the date or dates such payment or payments are due. If the registrant fails to pay such charged assessment by the date or dates such payment or payments are due, then the registrant shall be required to pay, in addition, a late fee in the amount of one hundred dollars. Such regis- tration shall be reinstated if the registrant pays such assessment charged and any applicable late fees and/or interest within sixty days of such expiration.] The superintendent shall approve or deny every application for registration hereunder within ninety days from the filing of a complete application provided, however, that failure to act within the prescribed period shall not be deemed approval of any such application. S 20. Section 595 of the banking law, as amended by chapter 571 of the laws of 1986, paragraph (c) of subdivision 1 as amended and para- graph (d) of subdivision 1 as added by chapter 164 of the laws of 2003, subdivision 2 as amended by chapter 121 of the laws of 1993, subdivision 3 as amended by chapter 516 of the laws of 1996, subdivisions 4, 5 and 6 as amended and subdivisions 4-a and 7-a as added by chapter 400 of the laws of 1993, is amended to read as follows:
S 595. Grounds for suspension or revocation of license, or suspension or deletion of name from mortgage broker roll. 1. [The] IN ADDITION TO THE AUTHORITY SET FORTH IN SUBDIVISION TWO OF THIS SECTION, THE super- intendent may SUSPEND OR revoke any license to engage in the business of a mortgage banker issued pursuant to this article or SUSPEND OR delete the name of a mortgage broker [from the roll of mortgage brokers] OR A MORTGAGE LOAN SERVICER registered pursuant to this article (EACH REFERRED TO IN THIS SECTION AS A REGISTRANT) if he OR SHE shall find AFTER NOTICE AND A HEARING, that: (a) Through a course of conduct, the licensee or registrant has violated any provisions of this article, or any rule or regulation promulgated by the [banking board, or any rule or regulation prescribed by the] superintendent under and within the authority of this article or of any other law, rule or regulation of this state or the federal government; (b) Any fact or condition exists which, if it had existed at the time of the original application for such license or registration, would have warranted the superintendent in refusing originally to issue such license; (c) The commission by a licensee or registrant of a crime against the laws of this state or any other state or of the United States involving moral turpitude or fraudulent or dishonest dealing, or the entry of a final judgment against a licensee or registrant in a civil action upon grounds of fraud, misrepresentation or deceit; (d) As a part of such determination regarding suspension or revoca- tion, the superintendent is authorized to require the fingerprinting of any licensee or registrant. Such fingerprints shall be submitted to the division of criminal justice services for a state criminal history record check, as defined in subdivision one of section three thousand thirty-five of the education law, and may be submitted to the federal bureau of investigation for a national criminal history record check. 2. (A) The superintendent may, [on] FOR good cause [shown], WITHOUT NOTICE OR A HEARING, or where there is a substantial risk of public harm, [suspend] ISSUE AN ORDER SUSPENDING any license or [delete the name of any registrant] REGISTRATION ISSUED PURSUANT TO THIS ARTICLE for a period not exceeding [thirty] NINETY days, pending investigation. "Good cause", as used in this subdivision, shall exist only when the licensee or registrant has defaulted or is likely to default in perform- ing its financial engagements or engages in dishonest or inequitable practices which may cause substantial harm to the persons afforded the protection of this article. (B) THE SUPERINTENDENT MAY, IN HIS OR HER SOLE DISCRETION, WITHOUT A HEARING, ISSUE A NOTICE SUSPENDING THE LICENSE OR REGISTRATION OF ANY MORTGAGE BANKER OR MORTGAGE LOAN SERVICER THIRTY DAYS AFTER THE DATE OR DATES IT FAILS TO MAKE ANY PAYMENTS REQUIRED BY THIS CHAPTER. (C) THE SUPERINTENDENT MAY, IN HIS OR HER SOLE DISCRETION, WITHOUT NOTICE OR A HEARING, ISSUE AN ORDER SUSPENDING ANY LICENSE OR REGISTRA- TION ISSUED PURSUANT TO THIS ARTICLE: (I) THIRTY DAYS AFTER THE DATE THE LICENSEE OR REGISTRANT FAILS TO FILE ANY REPORT REQUIRED TO BE FILED BY IT WITH THE SUPERINTENDENT PURSUANT TO THE AUTHORITY PROVIDED BY SECTION FIVE HUNDRED NINETY-SEVEN OF THIS ARTICLE; (II) IMMEDIATELY UPON NOTICE TO THE SUPERINTENDENT THAT ANY REQUIRED SURETY BOND OR LINE OF CREDIT IS BEING CANCELED OR IS EXPIRING, IF THE LICENSEE OR REGISTRANT HAS NOT PROVIDED THE SUPERINTENDENT WITH PROOF OF A REPLACEMENT BOND OR LINE OF CREDIT SATISFACTORY TO THE SUPERINTENDENT; (III) IMMEDIATELY UPON NOTICE TO THE SUPERINTENDENT THAT THE LICENSEE OR REGISTRANT HAS FILED A PETI-
TION IN BANKRUPTCY; OR (IV) AT LEAST THIRTY DAYS AFTER THE LICENSEE OR REGISTRANT HAS HAD FILED AGAINST IT A PETITION IN BANKRUPTCY. 3. IF THE SUPERINTENDENT HAS ISSUED AN ORDER SUSPENDING A LICENSE OR REGISTRATION PURSUANT TO PARAGRAPH (A) OF SUBDIVISION TWO OF THIS SECTION, SUCH LICENSE OR REGISTRATION MAY BE REINSTATED IF THE SUPER- INTENDENT DETERMINES, IN HIS OR HER SOLE DISCRETION AFTER INVESTIGATION, THAT GOOD CAUSE THEREFOR DID NOT EXIST OR NO LONGER EXISTS. IF THE SUPERINTENDENT HAS ISSUED AN ORDER OR NOTICE SUSPENDING A LICENSE OR REGISTRATION PURSUANT TO PARAGRAPH (B) OR PARAGRAPH (C) OF SUBDIVISION TWO OF THIS SECTION, SUCH LICENSE OR REGISTRATION MAY BE REINSTATED, IF THE SUPERINTENDENT DETERMINES, IN HIS OR HER SOLE DISCRETION, THAT THE LICENSEE OR REGISTRANT HAS CURED ALL DEFICIENCIES SET FORTH IN SUCH SUSPENSION ORDER OR THE NOTICE BY THE CLOSE OF BUSINESS NINETY DAYS AFTER THE DATE OF SUCH SUSPENSION ORDER OR NOTICE, INCLUDING, WITHOUT LIMITATION, MAKING ANY OVERDUE PAYMENT, HAVING ANY SUCH BANKRUPTCY PETI- TION DISMISSED OR HAVING SUCH BOND REINSTATED OR REPLACED. OTHERWISE, UNLESS THE SUPERINTENDENT HAS, IN HIS OR HER SOLE DISCRETION, EXTENDED A SUSPENSION PURSUANT TO PARAGRAPH (B) OR PARAGRAPH (C) OF SUBDIVISION TWO OF THIS SECTION, SUCH LICENSE OR REGISTRATION SHALL BE DEEMED TO BE AUTOMATICALLY TERMINATED BY OPERATION OF LAW AT THE CLOSE OF BUSINESS ON SUCH NINETIETH DAY. 4. Except as provided in subdivision two of this section, no license or registration shall be revoked or suspended except after notice and a hearing thereon. Any order of suspension issued after notice and a hear- ing may include as a condition of reinstatement that the licensee or registrant make restitution to consumers of fees or other charges which have been improperly charged or collected as determined by the super- intendent. [4. Any] 5. WITH THE PRIOR APPROVAL OF THE SUPERINTENDENT, ANY licen- see or registrant UNDER THIS ARTICLE may surrender any license or [certificate] REGISTRATION by delivering to the superintendent written notice that it thereby surrenders such license or [certificate] REGIS- TRATION, but such surrender shall not affect such licensee's or regis- trant's civil or criminal liability for acts committed prior to such surrender. [If such surrender is made after the issuance by the super- intendent of a statement of charges and notice of hearing, the super- intendent may proceed against the licensee or registrant as if such surrender had not taken place. 4-a. An expiration] 6. A TERMINATION of registration OR LICENSE in accordance with THIS section [five hundred ninety-two-a of this article] shall not affect such registrant's OR LICENSEE'S civil or criminal liability for acts committed prior to such [expirations] TERMINATION. If such [expiration] TERMINATION occurs after the issuance by the super- intendent of a statement of charges and notice of hearing, the super- intendent may proceed against the registrant OR LICENSEE as if such [expiration] TERMINATION had not taken place. [5] 7. No revocation, suspension, surrender or [expiration] TERMI- NATION of any license or [certificate] REGISTRATION shall impair or affect the obligation of any preexisting lawful contract between the licensee or registrant and any person. [6] 8. Every license or registration issued pursuant to this article shall remain in force and effect until the same shall have [expired] TERMINATED in accordance with [section five hundred ninety-two-a of this article] SUBDIVISION TWO OR THREE OF THIS SECTION or shall have been surrendered, revoked or suspended in accordance with any other provisions of this article, but the superintendent shall have authority
to reinstate a suspended license or [certificate] REGISTRATION or to issue a new license or [certificate] REGISTRATION to a licensee or registrant whose license or registration shall have been TERMINATED OR revoked if no fact or condition then exists which would have warranted the superintendent in refusing originally to issue such license or registration under this article. [7] 9. Whenever the superintendent shall revoke or suspend a license or registration issued pursuant to this article OTHER THAN PURSUANT TO PARAGRAPH (B) OF SUBDIVISION TWO OF THIS SECTION, he OR SHE shall forth- with execute in duplicate a written order to that effect. The super- intendent shall file one copy of such order in the office of the depart- ment of banking and shall forthwith serve the other copy upon the licensee or registrant. Any such order may be reviewed in the manner provided by article seventy-eight of the civil practice law and rules. Such application for review as authorized by this section must be made within thirty days from the date of such order of suspension or revoca- tion. [7-a] 10. Whenever a registration OR LICENSE shall have [expired] TERMINATED in accordance with [section five hundred ninety-two-a of] this article, the superintendent shall notify the registrant OR LICENSEE that the registration OR LICENSE has [expired] TERMINATED and that the registrant OR LICENSEE may not engage in [the business of soliciting, processing, placing or negotiating a mortgage loan or offering to solic- it, process, place or negotiate a mortgage loan] ANY ACTIVITY REQUIRING REGISTRATION OR A LICENSE in this state. [8] 11. Any hearing held pursuant to the provisions of this section shall be noticed, conducted and administered in compliance with the state administrative procedure act. S 21. Section 254-b of the real property law, as added by chapter 119 of the laws of 1974, is amended to read as follows: S 254-b. Limitation on late charges AND INCREASED INTEREST RATE. 1. If a bond or note, or the mortgage on real property, heretofore or here- after made, improved by a one to six family residence occupied by the owner, securing the payment of [same] SUCH BOND OR NOTE, or a note representing a loan for the purpose of financing the purchase of an ownership interest in, and proprietary lease from, a corporation or partnership formed for the purpose of the cooperative ownership of resi- dential real estate, contains a provision whereby the mortgagee or lend- er retains the right to collect a late charge on any instalment which has become due and remains unpaid, such charge on any such delinquent instalment, regardless of the period it remains in default, shall not exceed and shall only be enforced to the extent of two percent of such delinquent instalment; provided, however, that no charge shall be imposed on any instalment paid within fifteen days after the due date. No such late charge shall be deducted from any regular instalment payment by the mortgagor or borrower, but shall be separately charged and collected by the mortgagee or lender. In the absence of a specific provision in a bond, note or mortgage no late charge on any delinquent instalment shall be assessed or collected. The term "instalment" shall include amounts representing interest, amortization of principal and payments in respect of insurance premiums, taxes and utility charges if the bond, note or mortgage provides for collection thereof by the mort- gagee. 2. NO BOND OR NOTE, OR THE MORTGAGE ON REAL PROPERTY IMPROVED BY A ONE TO SIX FAMILY RESIDENCE OCCUPIED BY THE OWNER, SECURING THE PAYMENT OF SUCH BOND OR NOTE, OR A NOTE REPRESENTING A LOAN FOR THE PURPOSE OF
FINANCING THE PURCHASE OF AN OWNERSHIP INTEREST IN, AND PROPRIETARY LEASE FROM, A CORPORATION OR PARTNERSHIP FORMED FOR THE PURPOSE OF THE COOPERATIVE OWNERSHIP OF RESIDENTIAL REAL ESTATE MAY CONTAIN A PROVISION WHICH INCREASES THE INTEREST RATE AFTER DEFAULT. THIS PROVISION DOES NOT APPLY TO INTEREST RATE CHANGES IN A VARIABLE RATE LOAN OTHERWISE CONSISTENT WITH THE PROVISIONS OF THE LOAN DOCUMENTS; PROVIDED THAT THE CHANGE IN THE INTEREST RATE IS NOT TRIGGERED BY THE EVENT OF DEFAULT OR THE ACCELERATION OF THE INDEBTEDNESS. 3. The provisions in this section shall not apply to any loan or forbearance insured by the federal housing commissioner or for which a commitment to insure has been made by the federal housing commissioner or to any loan or forbearance insured or guaranteed pursuant to the provisions of an act of congress entitled "Servicemen's Readjustment Act of 1944", or to the extent the provisions of this section are inconsist- ent with any other federal law or regulation. [3] 4. If any provision of this section, or the application of such provision to any individual, company, corporation, or circumstance, shall be held invalid, the remainder of this section, and the applica- tion of such section to individuals, companies, corporations, or circum- stances other than those to which it is held invalid, shall not be affected thereby. S 22. Section 9001-a of the banking law, as added by chapter 321 of the laws of 1992, subdivisions (a) and (b) as amended and subdivision (d) as added by chapter 302 of the laws of 2003, is amended to read as follows: S 9001-a. Fingerprints. [(a)] 1. Notwithstanding any other provision of law, every incorporator of a corporation shall, in addition to any other requirements which may be imposed by the superintendent, submit simultaneously with an application, his or her fingerprints in such form and in such manner as specified by the division of criminal justice services, but in any event, no less than two digit imprints. The super- intendent shall submit the fingerprints to the division of criminal justice services for the purpose of conducting a criminal history search and returning a report thereon in accordance with the procedures and requirements established by the division pursuant to the provisions of article thirty-five of the executive law, which shall include the payment of the prescribed processing fees. The superintendent shall request that the division submit such fingerprints to the federal bureau of investigation, together with the processing fees prescribed by such bureau, for the purpose of conducting a criminal history search and returning a report thereon. [(b)] 2. The superintendent [shall] MAY also, concurrent with an investigation of an incorporator of a corporation pertaining to a violation of this chapter, submit such fingerprints to the division of criminal justice services for the purpose of conducting a criminal history search and returning a report thereon and through the division to the federal bureau of investigation for the purpose of a fingerprint check of such incorporator. [(c)] 3. For purposes of this section, ["incorporator"] "APPLICANT" SHALL INCLUDE AN INCORPORATOR AND shall include a natural person or such principal, officer, director, trustee or stockholder of any other entity as may be designated by the superintendent. Notwithstanding any other provision of this article, the superintendent shall not access criminal history data or information, unless any agency from which the super- intendent receives directly criminal history data or information has
entered into a use and dissemination agreement with the superintendent consistent with the provisions of this section. [(d)] 4. An applicant shall not be required to submit his or her fing- erprints as required by subdivision [(a)] ONE of this section if such applicant (i) is already subject to regulation by the department and the applicant has submitted such fingerprints to the department, such fing- erprints have been submitted to the division of criminal justice services for the purpose of conducting a criminal history search, and a report of such search has been received by the department from such division WITHIN THE PAST FIVE YEARS; or (ii) is subject to regulation by a federal bank regulatory agency and has submitted such fingerprints to such agency which has had a criminal history search conducted of such individual and has shared such information or its determination result- ing from such search with the department WITHIN THE PAST FIVE YEARS; or (iii) is an officer or stockholder of a corporation whose common or preferred stock is registered on a national securities exchange, as provided in an act of congress of the United States entitled the "Secu- rities Exchange Act of 1934", [approved June sixth, nineteen hundred thirty-four, as amended,] or such other exchange or market system as the superintendent shall approve by regulation, and has submitted such fing- erprints to such exchange or market system which has had a criminal history search conducted of such individual and has shared such informa- tion or its determination resulting from such search with the department WITHIN THE PAST FIVE YEARS; provided, however, that the superintendent may subsequently require such applicant to submit such fingerprints if the superintendent has a reasonable basis for updating the information or determination resulting from the report of the criminal history search conducted at the request of such federal banking agency, exchange or market system. 5. WHENEVER AN INCORPORATOR HAS TIMELY FILED HIS OR HER FINGERPRINTS AS REQUIRED BY THIS SECTION, BUT: (I) THE SUPERINTENDENT HAS NOT RECEIVED A REPORT OF THE RESULTS OF A RELATED CRIMINAL HISTORY SEARCH; (II) THE CIRCUMSTANCES WARRANT AN EXPEDITIOUS DETERMINATION; AND (III) THE SUPERINTENDENT DETERMINES, AFTER CONSIDERING ALL AVAILABLE INFORMA- TION, THAT THE REMAINING INCORPORATORS HAVE THE CHARACTER, RESPONSIBIL- ITY AND GENERAL FITNESS SO AS TO WARRANT BELIEF THAT, EVEN IF SUCH PERSON WERE NOT TO SERVE AS AN INCORPORATOR, SUCH BUSINESS WILL BE HONESTLY AND EFFICIENTLY OPERATED, THE SUPERINTENDENT MAY WAIVE THE REQUIREMENT FOR RECEIPT OF SUCH REPORT PRIOR TO APPROVAL, SUBJECT TO THERE BEING AN ADEQUATE NUMBER OF OTHER INCORPORATORS TO SATISFY THE REQUIREMENTS OF THIS CHAPTER AND RECEIPT FROM SUCH INCORPORATOR OF HIS OR HER WRITTEN AGREEMENT TO RESIGN IMMEDIATELY FROM ALL POSITIONS HELD WITH SUCH ENTITY IF SUCH REPORT DEMONSTRATES, IN THE SOLE DISCRETION OF THE SUPERINTENDENT, THAT THE INCORPORATOR LACKS THE NECESSARY CHARACTER, RESPONSIBILITY AND FITNESS. S 23. Section 128 of the banking law, as amended by chapter 24 of the laws of 1958, is amended to read as follows: S 128. Preservation of books and records. Every bank and every trust company shall preserve all its records of final entry[, including cards used under the card system and deposit tickets,] for a period of at least six years from the date of making the same or from the date of the last entry thereon[; provided, however, that preservation of photograph- ic reproductions thereof or records in photographic form shall consti- tute compliance with the requirements of this section] BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. Notwithstanding the foregoing, the [banking board] SUPERINTENDENT may prescribe by regu-
lation such period of time longer or shorter than six years during which all records kept by banks and trust companies as fiduciary shall be preserved in original form. S 24. Subdivision 3 of section 175 of the banking law, as amended by chapter 369 of the laws of 1955, is amended to read as follows: 3. Every private banker shall preserve all [his] records of final entry[, including cards used under the card system and deposit tickets,] for a period of at least six years from the date of making the same or from the date of the last entry thereon[; provided, however, that pres- ervation of photographic reproduction thereof or records in photographic form shall constitute compliance with the requirements of this section] BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 25. Section 200-c of the banking law, as added by chapter 496 of the laws of 1993, is amended to read as follows: S 200-c. Maintenance of books, accounts and records. Every foreign banking corporation licensed pursuant to this chapter to maintain one or more branches, agencies or representative offices in this state shall maintain or make available at any such branch, agency or representative office appropriate books, accounts and records reflecting (i) all trans- actions effected by or on behalf of the branch, agency or representative office and (ii) all actions taken in this state by employees of the foreign banking corporation located in this state to effect transactions on behalf of any office of such foreign banking corporation located outside this state. SUCH RECORDS SHALL BE PRESERVED FOR A PERIOD OF AT LEAST SIX YEARS AND SHALL BE PRESERVED BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 26. Section 221-h of the banking law, as added by chapter 493 of the laws of 1979, is amended to read as follows: S 221-h. Licensee's books and records; reports. A foreign banking corporation licensed pursuant to this article shall [keep] CREATE or cause each of its representatives to [keep] CREATE and use such books, accounts and records as will enable the superintendent to determine whether the representative is complying with the provisions of this article and with the rules and regulations lawfully made by the super- intendent. Such books, accounts and records shall be preserved for at least three years[; provided however, that preservation by photographic reproduction thereof or records in photographic form shall constitute compliance with the requirements of this section] BY ANY MANNER PERMIT- TED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. The superintendent may require such regular or special reports as may be deemed necessary to the proper supervision of licensees under this article. Such additional reports shall be in the form prescribed by the superintendent and shall be subscribed and affirmed as true under the penalties of perjury. S 27. Section 239-a of the banking law, as added by chapter 164 of the laws of 2002, is amended to read as follows: S 239-a. Preservation of books and records. Every savings bank shall preserve all its records of final entry[, including cards used under the card system and deposit tickets,] for a period of at least six years from the date of making the same or from the date of the last entry thereon[; provided, however, that preservation of photographic reprod- uctions thereof or records in photographic form shall constitute compli- ance with the requirements of this section] BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. Notwithstanding the foregoing, the [banking board] SUPERINTENDENT may prescribe by regulation such
period of time longer or shorter than six years during which all records kept by saving banks as fiduciary shall be preserved in original form. S 28. Section 320 of the banking law, as amended by section 29 of part O of chapter 59 of the laws of 2006, is amended to read as follows: S 320. Books and records. EVERY SAFE DEPOSIT COMPANY SHALL CREATE SUCH BOOKS, ACCOUNTS AND RECORDS AS WILL ENABLE THE SUPERINTENDENT TO DETERMINE WHETHER SUCH COMPANY IS COMPLYING WITH THE PROVISIONS OF THIS ARTICLE AND WITH THE RULES AND REGULATIONS ADOPTED BY THE SUPERINTENDENT APPLICABLE TO SAFE DEPOSIT COMPANIES, AND SHALL PRESERVE SUCH BOOKS, ACCOUNTS AND RECORDS FOR A PERIOD OF AT LEAST TWO YEARS FROM THE DATE OF CREATING THE SAME OR SUCH OTHER PERIOD AS MAY BE ESTABLISHED BY THE SUPERINTENDENT, INCLUDING PRESERVATION IN ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. Every safe deposit company shall conform its methods of keeping its books and records to such orders in respect thereto as shall have been made and promulgated by the super- intendent pursuant to the provisions of article two of this chapter. Any safe deposit company that refuses or neglects to obey such order shall be subject to a penalty of an amount as determined pursuant to section forty-four of this chapter for each day it so refuses or neglects. S 29. The opening paragraph of section 349 of the banking law, as amended by chapter 499 of the laws of 1995, is amended to read as follows: The licensee shall [keep] CREATE and use in its business such books, accounts, and records as will enable the superintendent to determine whether such licensee is complying with the provisions of this article and with the rules and regulations lawfully made by the superintendent hereunder. Every licensee shall preserve such books, accounts, and records[, including cards used in the card system, if any,] for at least two years after making the final entry on any loan recorded therein. [Preservation of photographic reproduction thereof or records in photo- graphic form, including an optical disk storage system and the use of electronic data processing equipment that provides comparable records to those otherwise required and which are available for examination upon request shall constitute compliance with the requirements of this section] SUCH RECORDS SHALL BE PRESERVED BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 30. Subdivision 5 of section 372 of the banking law, as amended by chapter 151 of the laws of 1945 and as renumbered by chapter 263 of the laws of 1983, is amended to read as follows: 5. Each licensee shall [keep] CREATE and use in its business such books, accounts, and records as [the superintendent may require to carry into effect] WILL ENABLE THE SUPERINTENDENT TO DETERMINE WHETHER SUCH LICENSEE IS COMPLYING WITH the provisions of this article and the rules and regulations made by the superintendent hereunder. Every licensee shall preserve such books, accounts and records for at least two years BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 31. Section 378-d of the banking law, as added by chapter 164 of the laws of 2002, is amended to read as follows: S 378-d. Preservation of books and records. Every savings and loan association shall preserve all its records of final entry[, including cards used under the card system and deposit tickets,] for a period of at least six years from the date of making the same or from the date of the last entry thereon[; provided, however, that preservation of photo- graphic reproductions thereof or records in photographic form shall constitute compliance with the requirements of this section] BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. Notwithstand-
ing the foregoing, the [banking board] SUPERINTENDENT may prescribe by regulation such period of time longer or shorter than six years during which all records kept by savings and loan associations as fiduciary shall be preserved in original form. S 32. Subdivision 2 of section 485 of the banking law, as added by chapter 608 of the laws of 1996, is amended to read as follows: 2. Every credit union shall preserve all of its records of [original and] final entry[, including cancelled checks, withdrawal slips and deposit tickets,] for a period of at least six years from the date of making same or from the date of the last entry thereon[; provided, however, that preservation of photographic reproduction thereof or records in photographic form shall constitute compliance with the requirements of this section] BY ANY MANNER PERMITTED BY SECTION THIR- TY-SIX-B OF THIS CHAPTER. S 33. The banking law is amended by adding a new section 498-c to read as follows: S 498-C. BOOKS AND RECORDS. EVERY LICENSEE SHALL CREATE SUCH BOOKS, ACCOUNTS AND RECORDS AS WILL ENABLE THE SUPERINTENDENT TO DETERMINE WHETHER SUCH LICENSEE IS COMPLYING WITH THE PROVISIONS OF THIS ARTICLE AND WITH THE RULES AND REGULATIONS ADOPTED BY THE SUPERINTENDENT APPLI- CABLE TO LICENSEES, AND SHALL PRESERVE SUCH BOOKS, ACCOUNTS AND RECORDS FOR A PERIOD OF AT LEAST TWO YEARS FROM THE DATE OF CREATING THE SAME OR SUCH OTHER PERIOD AS MAY BE ESTABLISHED BY THE SUPERINTENDENT, INCLUDING PRESERVATION IN ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 34. Section 515 of the banking law, as amended by chapter 369 of the laws of 1955, is amended to read as follows: S 515. Preservation of records of investment company. Every investment company shall preserve all its records of final entry[, including cards used under the card system and deposit tickets,] for a period of at least six years from the date of making the same or from the date of the last entry thereon[; provided, however, that preservation of photograph- ic reproduction thereof or records in photographic form shall constitute compliance with the requirements of this section] BY ANY MANNER PERMIT- TED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 35. Subdivision 1 of section 565 of the banking law, as added by chapter 488 of the laws of 1960, is amended to read as follows: 1. The licensee shall [keep] CREATE and use in his OR HER business such books, accounts and records as will enable the superintendent to determine whether such licensee is complying with the provisions of this article and with the rules and regulations lawfully made by the super- intendent hereunder. Every licensee shall preserve such books, accounts and records[, including cards used in a card system, if any,] for at least six years after making the final entry in respect to any premium finance agreement recorded therein[; provided, however, the preservation of photographic reproductions thereof or records in photographic form shall constitute compliance with this requirement] BY ANY MANNER PERMIT- TED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 36. Subdivision 1 of section 586 of the banking law, as added by chapter 448 of the laws of 1975, is amended to read as follows: 1. The licensee shall [keep] CREATE and use in its business such books, accounts, and records as will enable the superintendent to deter- mine whether such licensee is complying with the provisions of this article and with the rules and regulations lawfully made by the super- intendent hereunder. Every licensee shall preserve such books, accounts, and records, for at least three years[; provided, however, that preser-
vation by photographic reproduction thereof or records in photographic form shall constitute compliance with the requirements of this section]
BY ANY MANNER PERMITTED BY SECTION THIRTY-SIX-B OF THIS CHAPTER. S 37. The opening paragraph of section 597 of the banking law, as separately amended by chapters 315 and 472 of the laws of 2008, is amended to read as follows: Each licensee, servicer, registrant and exempt organization shall [keep] CREATE and use in its business such books, accounts and records as will enable the superintendent to determine whether such licensee, servicer, registrant or exempt organization is complying with the provisions of this article and with the rules and regulations lawfully made by the superintendent [and the banking board]. Every licensee, servicer, registrant and exempt organization shall preserve such books, accounts, and records, for at least [three] SIX years[; provided, howev- er, that preservation by photographic reproduction thereof or records in photographic form, including an optical disk storage system and the use of electronic data processing equipment that provides comparable records to those otherwise required] BY ANY MANNER PERMITTED BY SECTION THIRTY- SIX-B OF THIS CHAPTER and which are available for examination upon request shall constitute compliance with the requirements of this section. S 38. Section 651-b of the banking law, as added by chapter 374 of the laws of 1979, is amended to read as follows: S 651-b. Maintenance of books and records by MONEY TRANSMITTERS AND agents. Each licensee shall MAKE AND KEEP, AND SHALL require of each of its agents to make and keep, IN ANY MANNER PERMITTED BY SECTION THIRTY- SIX-B OF THIS CHAPTER, such accounts, correspondence, memoranda, papers, books and other records as the superintendent by regulation or order requires. All records so required shall be preserved for the time speci- fied by the regulation or order of the superintendent. S 39. This act shall take effect immediately; provided that section twenty-one of this act shall only apply to loans made after the effec- tive date of this act; provided further that sections twenty-eight and thirty-three of this act shall take effect on the sixtieth day after this act shall have become a law.

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