What's happening
This bill requires money transfer agents to remit funds to licensed transmitters on time, with penalties for delays.
Why it matters
Protects licensed money transmitters. by making agents civilly liable for up to three times the actual damages if they intentionally or negligently delay remitting funds, which could deter bad actors and encourage timely payments.
Strengthens consumer trust. in money transfer services, since timely remittance reduces the risk of lost or delayed funds for end users who rely on these services for sending or receiving money.
Empowers state regulators. (the superintendent) to set maximum allowable remittance periods by rule, giving flexibility to adjust standards as business practices or risks evolve.
Establishes clear contractual obligations. between agents and licensees, encouraging more transparent and enforceable business relationships in the money transmission industry.
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Who cares
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Speed Up Money Transfers
Plain English, a few words. Used as the page title.
Sponsors
No co-sponsors yet.
History
- Signed chap.324
- Delivered to governor
- Returned to senate
- Passed assembly
- Ordered to third reading rules cal.241
- Substituted for A1826A
- Referred to codes
- Returned to assembly
- Repassed senate
- Amended on third reading 2109a
- Vote reconsidered - restored to third reading
- Returned to senate
Show 8 earlier actions
- Recalled from assembly
- Referred to banks
- Delivered to assembly
- Passed senateVote 58–0
- Advanced to third reading
- 2nd report cal.
- 1st report cal.183
- 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.
Speed Up Money Transfers
Assembly Floor Calendar · Sponsor Victor M. Pichardo
Full text
1 pageUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
2109--A Cal. No. 183
2019-2020 Regular Sessions
IN SENATE
January 22, 2019
Introduced by Sen. SANDERS -- read twice and ordered printed, and when printed to be committed to the Committee on Banks -- reported favorably from said committee, ordered to first and second report, ordered to a third reading, passed by Senate and delivered to the Assembly, recalled, vote reconsidered, restored to third reading, amended and ordered reprinted, retaining its place in the order of third reading
AN ACT to amend the banking law, in relation to remittances of moneys by agents of licensed transmitters of money
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. The opening paragraph of section 651-a of the banking law is designated subdivision 1 and a new subdivision 2 is added to read as follows:
2. Every agent of a licensee shall remit all moneys owed such licensee in accordance with the terms of the contract between the licensee and such agent. Any intentional or negligent failure of an agent to remit all moneys due and owing the licensee within the time provided in such contract shall result in the agent's civil liability to the licensee for three times the licensee's damages. The superintendent may, by rule, establish the maximum period of time for remittance.
§ 2. This act shall take effect on the one hundred eightieth day after it shall have become a law. Effective immediately, the addition, amendment and/or repeal of any rule or regulation necessary for the implementation of this act on its effective date are authorized to be made and completed on or before such effective date.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD05855-03-9
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the banking law, in relation to remit- tances of moneys by agents of licensed transmitters of money
Purpose
To authorize treble damages in order to deter agents of licensed money transmitters from abusing business relationships and consumer trust by absconding with funds.
Summary of provisions
Section 1 amends the banking law to impose treble damages for agents of money transmitters who fail to remit moneys within a time period to be established by the superintendent.
Section 2 establishes the effective date.
Difference between original and amended version (if applicable)
Added"intentional or negligent" in the failure to remit payment.
Justification
Money transmitters play a critical role in the economy of New York State, providing consumers with safe and secure financial services including money orders, bill payments, and secure local, national and international funds transfers. In order to reach a broad spectrum of consumers, money transmitters transact business through agents who, in turn, provide direct services to a local customer base. As soon as the agent receives funds from the customer, the money transmitter is legally obligated to pay the funds to a beneficiary as directed by the customer, whether or not the money transmitter ever receives the funds from the agent. These agents are legitimized in the eyes of consumers by their relationships with known and reliable money transmitters. Unfortunately, despite the best efforts at screening, an alarming number of agents abscond with funds collected from customers and fail to remit the funds to the transmitter. This leaves the money transmitter legally obligated to pay for the instrument the rogue agent sold despite never having received the funds from the agent for the transaction and forces the money transmitter to take costly measures to attempt to recoup the funds from the dishonest agents. Moreover, these bad actors abuse the public trust and drive up the cost of doing business, which hurts consumers.
This bill, modeled after existing law in jurisdictions including New Jersey, North Carolina, Illinois and the District of Columbia, would serve to deter these bad actors by authorizing treble damages against agents who abscond with funds owed to the money transmitting companies. This legislation is necessary to protect both money transmitters and consumers because prosecuting agencies most often consider these actions to be civil matters, leaving money transmitters no recourse but to undertake costly litigation and pass at least some of the costs onto consumers. The threat of treble damages will change the calculus for potential bad actors, help make wronged money transmitters whole, and provide potentially significant savings to consumers.
Legislative history
2016: referred to banks 2013-2014: S.3930
Fiscal implications
To be determined.
Effective date
This act shall take effect on the one hundred eightieth day after it shall have become law; provided that, effective immediately, any rules and regulations necessary to implement the provisions of this act on its effective date are authorized and directed to be completed on or before such date.
Summaries, headlines and scores are AI-generated from the official bill text. How we score bills. Source: NYS Open Legislation.