What's happening
This bill requires banks to immediately notify customers when overdraft protection is used and to disclose any related fees or penalties.
Why it matters
Empowers consumers to avoid unexpected fees. by ensuring they are notified right away whenever overdraft protection is activated, giving them a chance to adjust their behavior or finances before additional fees accrue.
Increases transparency in banking practices. , requiring banks to clearly disclose any fees or penalties tied to overdraft protection, so customers are not surprised by hidden or unclear charges.
Provides flexibility in notification methods. , allowing customers to choose how they want to be contacted (e.g., email or another preferred method), which can help ensure timely and effective communication.
May encourage more responsible financial behavior. , as immediate alerts about account status could help customers track their spending and avoid repeat overdrafts in the future.
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Banks Must Notify Overdrafts
Plain English, a few words. Used as the page title.
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History
- Referred to banks
- Referred to banks
Companion bill
The same bill in the other chamber. A bill becomes law when one version passes both houses and the governor signs it, so either number can carry it.
Banks Must Notify Overdrafts
In Senate Committee · Banks · Sponsor Leroy Comrie
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
5413
2017-2018 Regular Sessions
IN ASSEMBLY
February 8, 2017
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 notify customers of account overdrafts in certain circumstances
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The banking law is amended by adding a new section 135 to read as follows:
§ 135. Account notifications. 1. Where a banking institution under this article offers its customers or depositors overdraft protection, or any other similar service wherein the banking institution charges a fee to prevent account penalties for insufficient funds, such institution shall notify such customer or depositor whenever such service is employed to prevent account penalties.
2. A banking institution shall immediately notify a customer or depositor of the insufficiency of funds in such individual's account or accounts via electronic mail, or if the individual prefers, through any other method of notification. Such notification shall state that the bank's overdraft service has gone into effect and shall list any fees and penalties associated with such service.
§ 2. The banking law is amended by adding a new section 458 to read as follows:
§ 458. Account notifications. 1. Where a banking institution under this article offers its customers or depositors overdraft protection, or any other similar service wherein the banking institution charges a fee to prevent account penalties for insufficient funds, such institution shall notify such customer or depositor whenever such service is employed to prevent account penalties.
2. A banking institution shall immediately notify a customer or depositor of the insufficiency of funds in such individual's account or 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.
LBD00343-01-7
A. 5413 2
other method of notification. Such notification shall state that the bank's overdraft service has gone into effect and shall list any fees and penalties associated with such service.
§ 3. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.