What's happening
This bill requires banks to immediately notify customers when overdraft protection is used, including details of related fees and penalties.
Why it matters
Empowers consumers to make informed decisions. by ensuring they are immediately aware when their account goes negative and when overdraft protection is activated, potentially helping them avoid additional fees or adjust spending habits quickly.
Enhances transparency around bank fees. , as customers will receive a detailed breakdown of any charges or penalties associated with the use of overdraft protection, reducing the likelihood of surprise costs.
Promotes financial accountability for banks. , requiring them to proactively communicate with customers rather than relying on customers to discover overdraft activity after the fact, which could improve trust in banking relationships.
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Who cares
Banking institutions offering fee-based overdraft services
They would have to notify customers immediately whenever those services are used and disclose associated fees and penalties.
Customers and depositors using overdraft protection
They would receive notice that their accounts have insufficient funds and that the bank's overdraft service has taken effect.
Bank customers who prefer notifications other than email
They could choose another notification method instead of receiving overdraft notices by email.
Headline styles
Notify Customers of Overdrafts
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
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
4023
2019-2020 Regular Sessions
IN ASSEMBLY
January 31, 2019
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.
LBD07487-01-9
A. 4023 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.