N.Y. Banking Law § 14-f: Power of the superintendent of financial services to require the provision of basic banking services

§ 14-f. Power of the superintendent of financial services to require

the provision of basic banking services. 1. The legislature finds and

declares that certain consumers residing in this state may be unable to

afford, without undue financial hardship, the cost of maintaining a

consumer transaction account at a banking institution located in this

state. It is the policy of this state that, consistent with safe and

sound banking practices, banking institutions make available lower cost

banking services to consumers. It is further intended that no banking

institution be required to offer lower cost banking services at a cost

to account holders which is less than the actual cost to the banking

institution to provide such services.

2. Except as otherwise provided in this section, every banking

institution shall make available to consumers a consumer transaction

account, to be known as a "basic banking account", with the following

features to be prescribed by the superintendent of financial services by

regulation:

(a) the maximum amount which a banking institution may require as an

initial deposit, if any;

(b) the maximum amount a banking institution may require as a minimum

balance, if any, to maintain such account;

(c) eight withdrawal transactions for account holders under sixty-five

years of age, and twelve withdrawal transactions for account holders

sixty-five years of age or older, including those conducted at

electronic facilities, during any periodic cycle at no additional charge

to the account holder; and

(d) the maximum amount a banking institution may charge per periodic

cycle for the use of such account.

3. With respect to any transactions in excess of the number specified

in accordance with paragraph (c) of subdivision two of this section, (a)

a banking institution may impose a reasonable per-transaction charge, or

(b) it may impose the fees and charges normally applied to other

consumer transaction accounts available at that banking institution

provided that any charge per periodic cycle imposed hereunder must be

reduced by the charge imposed under paragraph (d) of subdivision two of

this section; provided however, that at no time shall the fees and

charges on the basic banking account exceed the amount that is normally

applied to other consumer transaction accounts available at that banking

institution.

4. A banking institution may require as a condition for opening or

maintaining a basic banking account, (a) that the holder of a basic

banking account be a resident of this state; and (b) the direct deposit

to the banking institution of recurring payments such as, but not

limited to, social security, wage, or pension payments where direct

deposit is available to both the consumer and the banking institution.

5. Except as provided in this section and any rules and regulations

promulgated hereunder, a basic banking account may be offered subject to

the same rules, conditions and terms normally applicable to other

consumer transaction accounts offered by the banking institution;

provided that the fees and charges for specific services other than

those otherwise provided in this section shall not exceed those imposed

by the banking institution for the same services in connection with

other consumer transaction accounts offered by the banking institution.

6. No banking institution shall be required to permit any person to

open or maintain a basic banking account pursuant to this section if

such person maintains another consumer transaction account either at

that banking institution or any other banking institution.

7. In lieu of the basic banking account required by this section, a

banking institution may make available an alternative account or other

banking services determined by the superintendent to be at least as

advantageous to consumers as the basic banking account.

8. (a) Where a banking institution posts in the public area of its

offices notice of the availability of its other consumer transaction

accounts, it shall also post equally conspicuous notice in such public

areas and in the same manner the availability of its basic banking

accounts. Where a banking institution makes available in such public

areas material describing the terms of its other consumer transaction

accounts, it shall also make comparable descriptive material available

in the same such areas and in the same manner for its basic banking

account.

(b) Where a banking institution posts in the public area of its

offices the notices for information required in paragraph (a) of this

subdivision, it shall also post equally conspicuous notice in such

public areas and in the same manner, of the department's toll free

consumer's hotline telephone number, where consumers can file complaints

if a consumer is not satisfied with the services a banking institution

provides.

9. For purposes of this section:

(a) "banking institution" means any bank, trust company, savings bank,

savings and loan association, or credit union, or branch of a foreign

banking corporation the deposits of which are insured by the Federal

Deposit Insurance Corporation, which is incorporated, chartered,

organized or licensed under the laws of this state or any other state or

the United States, and, in the ordinary course of its business, offers

consumer transaction accounts to the general public or, in the case of a

credit union, to its members;

(b) "consumer transaction account" means a demand deposit account,

negotiable order of withdrawal account, share draft account or similar

account used primarily for personal, family or household purposes.

10. For purposes of this section, any banking insititution which

offers share draft accounts shall use the term "basic share draft

account" instead of "basic banking account".

11. If any provision of this section, or the application of such

provision to any person or circumstance shall be held invalid, the

remainder of this section, and the application of such provisions

thereof to persons or circumstances other than those as to which it is

held invalid, shall not be affected thereby.