Expand Community Financial Services Access

Section 1. Short title. This act shall be known as and may be cited as the "community financial services access and modernization act of 2017".

§ 2. Paragraph (b) of subdivision 5 of section 18-a of the banking law, as amended by chapter 155 of the laws of 2012, is amended to read as follows:

(b) two thousand dollars when the application relates to the licensing of an additional location or change of location or the licensing of a [mobile unit] limited station of a licensed [casher of checks] financial services provider; or

§ 3. The third undesignated paragraph of section 340 of the banking law, as added by chapter 22 of the laws of 1990, is amended to read as follows:

Nothing in this article shall apply to licensed collateral loan brokers or licensed financial services providers.

§ 4. Section 366 of the banking law, as amended by chapter 49 of the laws of 1961, subdivision 1 as amended by chapter 849 of the laws of 1964 and as further amended by section 104 of part A of chapter 62 of the laws of 2011, subdivisions 2 and 3 as renumbered by chapter 132 of the laws of 1969, is amended to read as follows:

§ 366. Definitions. When used in this article. 1. The term "licensed [casher of checks] financial services provider" means any [individual, partnership, unincorporated association or corporation] person duly licensed by the superintendent of financial services to engage in business pursuant to the provisions of this article.

EXPLANATION--Matter in italics (underscored) is new; matter in brackets

[ ] is old law to be omitted.

LBD05202-01-7

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2. The term "licensee" means a person licensed [casher of checks, drafts and/or money orders] to provide financial services regulated by this article.

3. The term ["mobile unit"] "limited station" means any vehicle or other movable means from which the business of [cashing checks, drafts or money orders] providing financial services regulated by this article is to be conducted.

4. The term "person" means any individual or other legal entity, including any corporation, partnership, association or limited liability company.

5. The term "conduit services" means any activity permitted to be offered by a licensee under this article to its customers in collaboration with a state or federally chartered bank, trust company, savings bank, savings and loan association or credit union subject to the approval of the superintendent, provided no conduit services under this section shall be approved, which exceed prevailing usury provisions in state law, including but not limited to:

(a) business and commercial loans offered by licensees that are licensed under article nine of this chapter provided, however, that prior to making a loan directly, a licensee is required to offer and process a loan from a collaborating bank or credit union with the licensee under this section that may provide a more favorable rate and/or terms to the prospective borrower;

(b) account access services;

(c) bill payment services; and

(d) assistance in preparation and submission of forms to be processed by the collaborating bank or credit union.

6. The term "financial services" means offering or providing any of the following financial products or services: (a) the cashing of checks, drafts and/or money orders,

(b) money transmission services as defined in article thirteen-B of this chapter, provided, however, a licensed financial services provider offering money transmission pursuant to article thirteen-B of this chapter, other than as an agent of a licensee, shall first obtain a license under that article,

(c) bill payment services,

(d) the sale of prepaid debit cards; and

(e) conduit services as defined in this article.

7. The term "master license" shall mean an original license issued by the superintendent that authorizes a person to engage in the business of cashing of checks and related financial services, and in the case of a licensee who has multiple licensed business locations at the time of the effective date of this subdivision, the initial longest site continuously licensed under this article.

8. The term "supplemental license" shall mean a license issued by the superintendent that authorizes a person having a master license to engage in the business of cashing of checks and related financial services at branch locations, and in the case of a licensee who has multiple licensed business locations at the time of the effective date of this subdivision, any license issued to an existing licensee after the license for the original site.

§ 5. Section 367 of the banking law, as amended by chapter 151 of the laws of 1945, subdivision 3 as amended by section 7 of part D-1 of chapter 109 of the laws of 2006, subdivision 4 as amended by chapter 96 of the laws of 1981, is amended to read as follows:

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§ 367. License requirements; fees; capital requirements. 1. No person[, partnership, association or corporation] shall engage in the business of cashing checks, drafts or money orders for a consideration without first obtaining a license from the superintendent.

2. Application for such license shall be in writing, under oath, and in the form prescribed by the superintendent, and shall contain the name, and the address both of the residence and place of business, of the applicant, and if the applicant is a co-partnership [or], association or limited liability company, of every member thereof, and if a corporation, of each officer and director thereof; also, if the business is to be conducted at a specific address, the address at which the business is to be conducted, and if the business is to be conducted from a [mobile unit] limited station, the New York state registration number or other identification of such [mobile unit] limited station and the area in which the applicant proposes to operate such [mobile unit] limited station; and also such further information as the superintendent may require.

3. Such applicant at the time of making such application shall pay to the superintendent a fee as prescribed pursuant to section eighteen-a of this chapter for investigating the application. An application for a master license shall be in writing, under oath, and in the form prescribed by the superintendent and shall contain such information as the superintendent may require by regulation. The application shall set forth all of the locations at which the applicant seeks to conduct business hereunder. At the time of making the application for a master license, an existing licensee under this article shall pay to the superintendent the sum of two hundred fifty dollars for each proposed location as a fee for investigating the application. An applicant that does not currently hold a license under this article at the time of application shall pay to the superintendent an application fee as provided in this chapter for initial applications. Any licensee requesting a change of address, shall at the time of making such request, pay to the superintendent a fee as prescribed pursuant to section eighteen-a of this chapter for investigating the new address; provided, however, that the superintendent may, in his or her discretion, waive such investigation fee if warranted, and provided further, that no fee shall be payable for the relocation of a limited station.

4. Every applicant shall prove, in form satisfactory to the superintendent that he or it has available for the operation of such business, for each location and for each [mobile unit] limited station specified in the application, liquid assets of at least ten thousand dollars, and every licensee shall continuously maintain for the operation of such business for each location and for each [mobile unit] limited station liquid assets of at least ten thousand dollars. Notwithstanding the foregoing provisions of this subdivision, the superintendent, upon application by an applicant and for good cause shown, may permit a reduction from ten thousand dollars to not less than five thousand dollars of minimum liquid assets required for each location.

§ 6. Section 369 of the banking law, as amended by chapter 151 of the laws of 1945, subdivision 1 as amended by chapter 233 of the laws of 2005, subdivisions 4 and 5 as amended by chapter 132 of the laws of 1969, subdivision 6 as amended by chapter 164 of the laws of 2003, paragraph (b) of subdivision 6 as amended by section 6 of part LL of chapter 56 of the laws of 2010, and subdivision 7 as added by chapter 485 of the laws of 1947, is amended to read as follows:

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§ 369. Conditions precedent to issuing license; issuance and filing of license; posting license. 1. If the superintendent shall find that the financial responsibility, experience, character, and general fitness of the applicant, and of the members thereof if the applicant be a co-partnership [or], association or limited liability company, and of the officers and directors thereof if the applicant be 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 purposes of this article, and if the superintendent shall find that the granting of such application will promote the convenience and advantage of the area in which such business is to be conducted, and if the superintendent shall find that the applicant has available for the operation of such business for each location and for each [mobile unit] limited station specified in the application liquid assets of at least ten thousand dollars, the superintendent shall thereupon execute a master license and if applicable one or more supplemental licenses in duplicate to permit the [cashing of checks, drafts and money orders] delivery of financial services in accordance with the provisions of this article at the location or locations or in the area or areas specified in such application. In finding whether the application will promote the convenience and advantage to the public, the superintendent shall determine whether there is a community need for a new licensee in the proposed area or areas to be served. No license shall be issued to an applicant for a license, at a location to be licensed which is closer than one thousand five hundred eighty-four feet (three-tenths of a mile) from an existing licensee, except with the written consent of such existing licensee or pursuant to subdivision three of section three hundred seventy of this article, subject to any restriction or condition as the superintendent may promulgate by regulation; provided, however, the superintendent may permit a location to be licensed that is closer than three-tenths of a mile from an existing licensee provided such applicant engages in the cashing of checks, drafts or money orders only for payees of such checks, drafts or money orders that are other than natural persons at the location to be licensed and such applicant was engaged in the cashing of such checks, drafts or money orders for payees that are other than natural persons at such location on or before the fourteenth day of July, two thousand four, and provided further that upon licensing any such location by the superintendent, such license as it pertains solely to such location shall not be affected thereafter by any change of control of such license pursuant to section three hundred seventy-a of this article, provided that the licensee continues thereafter to engage at that location in the cashing of checks, drafts or money orders only for payees that are other than natural persons and provided further that such license shall bear a legend stating that such location is restricted to the cashing of checks, drafts or money orders only for payees that are other than natural persons. The three-tenths of a mile distance requirement as set forth in this section shall not apply in cases where the existing licensee is a restricted location as authorized in the preceding sentence, or is any other licensed location that engages solely in the cashing of checks, drafts or money orders only for payees that are other than natural persons. For purposes of this section, such distance shall be measured on a straight line along the street between the nearest point of the store fronts of the check cashing facilities. The primary business of the licensee, at the location to be licensed, shall be financial services. The superintendent shall transmit one copy of such license to the applicant and file another in the

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office of the department. Notwithstanding the foregoing provisions of this subdivision, the superintendent, upon application by an applicant and for good cause shown, may permit a reduction from ten thousand dollars to not less than five thousand dollars of minimum liquid assets required for each location.