S T A T E   O F   N E W   Y O R K
       ________________________________________________________________________
                                         3224
                              2015-2016 Regular Sessions
                                 I N  A S S E M B L Y
                                   January 22, 2015
                                      ___________
       Introduced by M. of A. WEPRIN -- read once and referred to the Committee
         on Banks
       AN ACT to amend the banking law, in relation to requiring banks to noti-
         fy customers of account overdrafts in certain circumstances
         THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
       BLY, DO ENACT AS FOLLOWS:
    1    Section 1. The banking law is amended by adding a new section  135  to
    2  read as follows:
    3    S  135.  ACCOUNT  NOTIFICATIONS.  1. WHERE A BANKING INSTITUTION UNDER
    4  THIS ARTICLE OFFERS ITS CUSTOMERS OR DEPOSITORS OVERDRAFT PROTECTION, OR
    5  ANY OTHER SIMILAR SERVICE WHEREIN THE BANKING INSTITUTION CHARGES A  FEE
    6  TO  PREVENT  ACCOUNT  PENALTIES FOR INSUFFICIENT FUNDS, SUCH INSTITUTION
    7  SHALL NOTIFY  SUCH  CUSTOMER  OR  DEPOSITOR  WHENEVER  SUCH  SERVICE  IS
    8  EMPLOYED TO PREVENT ACCOUNT PENALTIES.
    9    2. A BANKING INSTITUTION SHALL IMMEDIATELY NOTIFY A CUSTOMER OR DEPOS-
   10  ITOR  OF  THE  INSUFFICIENCY  OF  FUNDS  IN SUCH INDIVIDUAL'S ACCOUNT OR
   11  ACCOUNTS VIA ELECTRONIC MAIL, OR IF THE INDIVIDUAL PREFERS, THROUGH  ANY
   12  OTHER  METHOD  OF  NOTIFICATION.  SUCH NOTIFICATION SHALL STATE THAT THE
   13  BANK'S OVERDRAFT SERVICE HAS GONE INTO EFFECT AND SHALL  LIST  ANY  FEES
   14  AND PENALTIES ASSOCIATED WITH SUCH SERVICE.
   15    S 2. The banking law is amended by adding a new section 458 to read as
   16  follows:
   17    S  458.  ACCOUNT  NOTIFICATIONS.  1. WHERE A BANKING INSTITUTION UNDER
   18  THIS ARTICLE OFFERS ITS CUSTOMERS OR DEPOSITORS OVERDRAFT PROTECTION, OR
   19  ANY OTHER SIMILAR SERVICE WHEREIN THE BANKING INSTITUTION CHARGES A  FEE
   20  TO  PREVENT  ACCOUNT  PENALTIES FOR INSUFFICIENT FUNDS, SUCH INSTITUTION
   21  SHALL NOTIFY  SUCH  CUSTOMER  OR  DEPOSITOR  WHENEVER  SUCH  SERVICE  IS
   22  EMPLOYED TO PREVENT ACCOUNT PENALTIES.
   23    2. A BANKING INSTITUTION SHALL IMMEDIATELY NOTIFY A CUSTOMER OR DEPOS-
   24  ITOR  OF  THE  INSUFFICIENCY  OF  FUNDS  IN SUCH INDIVIDUAL'S ACCOUNT OR
   25  ACCOUNTS VIA ELECTRONIC MAIL, OR IF THE INDIVIDUAL PREFERS, THROUGH  ANY
        EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                             [ ] is old law to be omitted.
                                                                  LBD07345-01-5
       A. 3224                             2
    1  OTHER  METHOD  OF  NOTIFICATION.  SUCH NOTIFICATION SHALL STATE THAT THE
    2  BANK'S OVERDRAFT SERVICE HAS GONE INTO EFFECT AND SHALL  LIST  ANY  FEES
    3  AND PENALTIES ASSOCIATED WITH SUCH SERVICE.
    4    S 3. This act shall take effect immediately.