What's happening
This bill establishes licensing and regulatory requirements for consumer reporting agencies in New York, granting oversight authority to the superintendent.
Why it matters
Creates a licensing requirement for all credit reporting agencies. operating in New York, meaning these companies must be vetted and approved by state authorities before conducting business, potentially increasing accountability and consumer protection.
Empowers the superintendent with broad oversight and investigatory powers. , including the authority to examine agency records, mandate compliance, and require sworn testimony, which could help uncover and address abuses or errors in credit reporting.
Allows for flexible rulemaking and guidance. by the superintendent, enabling state regulators to adapt quickly to new developments or risks in the credit reporting industry, and to clarify or interpret laws as needed for evolving financial products.
Provides mechanisms for excluding certain financial products or services from regulation. , but preserves the superintendent’s ability to act in cases of fraud, ensuring consumer protections remain robust even as the regulatory landscape changes.
Albany, before your first meeting.
Every bill that moved yesterday, summarized in a sentence and ranked by impact. The Albany Scorecard follows on Sundays.
Free. Unsubscribe in one click. Want alerts on specific bills? Create an account.
Who cares
Headline styles
License Credit Reporting Agencies
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to banks
- Referred to rules
Full text
2 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
6878
2017-2018 Regular Sessions
IN SENATE
September 20, 2017
Introduced by Sen. COMRIE -- read twice and ordered printed, and when printed to be committed to the Committee on Rules
AN ACT to amend the financial services law, in relation to regulation of consumer reporting agencies
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The financial services law is amended by adding a new article 7 to read as follows:
ARTICLE 7
REGULATION OF CONSUMER REPORTING AGENCIES Section 701. Definitions.
702. Authority of superintendent.
703. License requirements.
704. Superintendent authorized to examine.
705. Superintendent authorized to promulgate regulations.
§ 701. Definitions. For the purposes of this article, the term "consumer reporting agency" shall mean any person which, for monetary fees, dues, or on a cooperative nonprofit basis, regularly engages in whole or in part in the practice of assembling or evaluating consumer credit information or other information on consumers for the purpose of furnishing consumer reports to third parties, and which uses any means or facility of interstate commerce for the purpose of preparing or furnishing consumer reports.
§ 702. Authority of superintendent. The superintendent is hereby authorized and empowered to make such general rules and regulations, and such specific rulings, demands, and findings as may be necessary for the proper conduct of the business authorized and licensed under and for the enforcement of this article, in addition hereto and not inconsistent herewith.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD13513-01-7
S. 6878 2
§ 703. License requirements. (a) No person, partnership, association or corporation shall engage in the business of credit reporting without first obtaining a license from the superintendent.
(b) 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, of every member thereof, and if a corporation, of each officer and director thereof. Further, if the business is to be conducted at a specific address, the address at which the business is to be conducted, and in addition, such additional information as the superintendent may require.
§ 704. Superintendent authorized to examine. (a) For the purpose of discovering violations of this article or securing information lawfully required in this section, the superintendent may at any time, and as often as may be determined, either personally or by a person duly designated by the superintendent, investigate licensed consumer reporting agencies and examine the books, accounts, records, and files used therein of every licensee.
(b) For the purpose established in subdivision (a) of this section, the superintendent and his or her duly designated representatives shall have free access to the offices and places of business, books, accounts, papers, records, files, safes and vaults of all licensees. The superintendent shall have authority to require the attendance of and to examine under oath all persons whose testimony may be required relative to consumer reporting agencies.
§ 705. Superintendent authorized to promulgate regulations. (a) The superintendent shall have the power to prescribe and from time to time withdraw or amend, in writing, rules and regulations and issue orders and guidance involving credit reporting agencies, not inconsistent with the provisions of this chapter, the banking law, the insurance law and any other law in which the superintendent is given authority, including:
(1) effectuating any power given to the superintendent under the provisions of this chapter, the insurance law, the banking law, or any other law to prescribe forms or make regulations;
(2) interpreting the provisions of this chapter, the insurance law, the banking law, or any other applicable law; and
(3) governing the procedures to be followed in the practice of the department.
(b) The superintendent may promulgate a list of financial products and services excluded from regulation by the superintendent, provided that such exclusion shall not limit in any way the ability of the superintendent to take any actions with respect to fraud provided for in this chapter, the insurance law, the banking law or any other applicable law.
§ 2. This act shall take effect immediately.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the financial services law, in relation to regulation of consumer reporting agencies
Summary of provisions
This bill creates a new Article 7 within the existing Financial Services Law that authorizes and empowers the New York State Department of Finan- cial Services (DFS) to regulate consumer reporting agencies, including: oversight, licensing, examination and rulemaking powers.
Justification
On September 7th, 2017, one of three major consumer credit reporting agencies in the United States-Equifax-reported that hackers gained access to company data that potentially compromised sensitive informa- tion for 143 million American consumers - nearly 44% of the U.S. popu- lation. The breach included: social security numbers, driver's license numbers, names, addresses and birth dates. Keys that unlock consumers' medical histories, bank accounts, and employee accounts have also been compromised. Credit card numbers for 209,000 consumers were stolen, and documents with personal information used in disputes for 182,000 people were also stolen.
The attack on Equifax represents one of the largest risks to personally sensitive information in recent years. This incident is the third major cybersecurity threat for the agency since 2015. Just last year, identify thieves successfully hacked critical W-2 tax and salary data from an Equifax website. Earlier this year, thieves again stole W-2 tax data from an Equifax subsidiary, TALX, which provides online payroll, tax and human resources services to some of the nation's largest corporations. According to investigations, criminals gained access to certain files in the company's system from mid-May to July, 2017 by exploiting a weak point in website software.
Identity thieves can impersonate people with lenders, creditors, and service providers who rely on personal identity information. Thieves can also use stored information from Equifax and use it to open accounts with creditors that use Experian or TransUnion. Cybersecurity profes- sionals criticized Equifax for not improving its security practices after previous thefts. Critics also argue that Equifax should have multiple layers of controls. Consumers complained of a 6-week lag between the discovery of the attack and Equifax's public disclosure. Equifax discovered the intrusion on July 29th but it first disclosed the attack publicly on September 7th.
There seems to be a broad sense of uncertainty by experts and lawmakers as to which federal regulator, if any, is charged with the responsibil- ity to monitor and do regular supervision on cybersecurity. The Consumer Financial Protection Bureau has authority to police violations of consumer protection laws by consumer credit bureaus, but the agency generally leaves data privacy enforcement to the Federal Trade Commis- sion. However, the Trade Commission lacks the authority to impose big fines or authorize fines for first time violations of certain rules. Neither have commented on applicable law or jurisdiction. Although federal lawmakers have promised legislation and public hearings, no clear authority is forthcoming in short order. Thus, it is time for New York State to lead on this issue, given the fact that millions of our residents were exposed in this episode. TO THIS END, THIS LEGISLATION PROVIDES A CLEAR REGULATORY MANDATE OVER CREDIT REPORTING AGENCIES TO THE NEW YORK STATE DEPARTMENT OF FINANCIAL SERVICES (DFS) ALLOWING THEM TO AGGRESSIVELY PROTECT CONSUMER INTERESTS THROUGH POWERS THAT INCLUDE: OVERSIGHT, LICENSING, EXAMINATION AND RULEMAKING.
Legislative history
This is a new bill.
Fiscal implications
Possible increase of revenue due to the results of licensing and fines collected for potential violations of future regulations.
Effective date
This act shall take effect immediately.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.