New York Banking Law

Article 9-A, Licensed Cashers of Checks

Section 366.   Definitions.
        367.   License requirements; fees; capital requirements.
        369.   Conditions precedent to issuing license; issuance and
                 filing of license; posting license.
        370.   Restrictions as to place or area of doing business;
                 establishment of stations; change of location.
        370-a. Changes in control.
        371.   Regulations.
        372.   Fees and charges; posting schedule; records.
        373.   Acts prohibited; suspension or revocation of license;
                 penalties.
        374.   Application of article.

  S 366. Definitions. When used in this article. 1. The term "licensed
casher of checks" means any individual, partnership, unincorporated
association or corporation duly licensed by the superintendent of banks
to engage in business pursuant to the provisions of this article.
  2. The term "licensee" means a licensed casher of checks, drafts
and/or money orders.
  3. The term "mobile unit" means any vehicle or other movable means
from which the business of cashing checks, drafts or money orders is to
be conducted.

  S 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,
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, the New York state
registration number or other identification of such mobile unit and the
area in which the applicant proposes to operate such mobile unit; 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 the sum of two hundred fifty dollars as a fee for
investigating the application and the additional sum of three hundred
fifty dollars as a license fee for a period terminating on the last day
of the current calendar year except that in the event the business is to
be conducted from a mobile unit, the fee for investigating the
application shall be two hundred fifty dollars, and the license fee
shall be four hundred dollars; provided, that if the application is
filed after June thirtieth in any year such payment shall be one-half of
the stated license fee in addition to the said fee for investigation.
Every licensee shall, on or before the fifteenth day of December, each
year, pay to the superintendent of banks an annual license fee of three
hundred fifty dollars, or if the business is conducted from a mobile
unit four hundred dollars, for the next succeeding calendar year. Any
licensee requesting a change of address, shall at the time of making
such request, pay to the superintendent the sum of one hundred dollars
as a fee for investigating the new address; provided, however, that the
superintendent may, in his discretion, waive such investigation fee if
warranted.
  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 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 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.

  S 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, 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 specified in the application
liquid assets of at least ten thousand dollars, the superintendent shall
thereupon execute a license in duplicate to permit the cashing of
checks, drafts and money orders in accordance with the provisions of
this article at the location or in the area 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 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. 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 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.
  2. Such license shall state the name of the licensee; and if the
licensee is a co-partnership or association, the names of the members
thereof; and if the licensee is a corporation, the date of its
incorporation; and if the business is to be conducted at a specific
address, the address at which such business is to be conducted; and if
the business is to be conducted through the use of a mobile unit, the
New York state registration number or other identification of such
mobile unit and the area in which such mobile unit is authorized to do
business.
  3. Such license shall be kept conspicuously posted in the place of
business of the licensee or, in the case of a mobile unit, upon such
mobile unit. Such license shall not be transferable or assignable.
  4. Such license shall remain in full force and effect until it is
surrendered by the licensee or revoked or suspended as provided in this
article.
  5. If the superintendent shall find that the applicant fails to meet
any of the conditions set forth in subdivision one of this section, he
shall not issue such license, and he shall notify the applicant of the
denial.  If an application is denied or withdrawn, the superintendent
shall retain the investigation fee to cover the costs of investigating
the application and return the license fee to the applicant.
  6. The superintendent may refuse to issue a license pursuant to this
article if he shall find that the applicant, or any person who is a
director, officer, partner, agent, employee or substantial stockholder
of the applicant, (a) has been convicted of a crime in any jurisdiction
or (b) is associating or consorting with any person who has, or persons
who have, been convicted of a crime or crimes in any jurisdiction or
jurisdictions; provided, however, that the superintendent shall not
issue such a license if he shall find that the applicant, or any person
who is a director, officer, partner, agent, employee or substantial
stockholder of the applicant, has been convicted of a felony in any
jurisdiction or of a crime which, if committed within this state, would
constitute a felony under the laws thereof. For the purposes of this
article, a person shall be deemed to have been convicted of a crime if
such person shall have pleaded guilty to a charge thereof before a court
or magistrate, or shall have been found guilty thereof by the decision
or judgment of a court or magistrate or by the verdict of a jury,
irrespective of the pronouncement of sentence or the suspension thereof,
unless such plea of guilty, or such decision, judgment or verdict, shall
have been set aside, reversed or otherwise abrogated by lawful judicial
process or unless the person convicted of the crime shall have received
a pardon therefor from the president of the United States or the
governor or other pardoning authority in the jurisdiction where the
conviction was had, or shall have received a certificate of good conduct
granted by the board of parole pursuant to the provisions of the
executive law to remove the disability under this article because of
such conviction. The term "substantial stockholder," as used in this
subdivision, shall be deemed to refer to a person owning or controlling
ten per centum or more of the total outstanding stock of the corporation
in which such person is a stockholder. In making a determination
pursuant to this subdivision, the superintendent shall require
fingerprinting of the applicant. Such fingerprints shall be submitted to
the division of criminal justice services for a state criminal history
record check, as defined in subdivision one of section three thousand
thirty-five of the education law, and may be submitted to the federal
bureau of investigation for a national criminal history record check.
  7. No license pursuant to this article shall be issued to any
applicant to do business at the place specified in the application as
the place where the business is to be conducted if, within the twelve
months preceding such application, a license to engage in business
pursuant to this article at such place shall have been revoked.

  S 370. Restrictions as to place or area of doing business;
establishment of stations; change of location. 1. No more than one place
of business or one mobile unit shall be maintained under the same
license; provided, however, that more than one license may be issued to
the same licensee upon compliance with the provisions of this article
for each new license.
  2. Any licensed casher of checks may open and maintain, within this
state, one or more limited stations for the purpose of cashing checks,
drafts or money orders for the particular group or groups specified in
the license authorizing each such station. Such stations shall be
licensed pursuant to and be subject to all the provisions of this
chapter applicable to licensed cashers of checks, except that (a) no
bond shall be required for such a station, (b) the fee for investigating
the application for a station shall be ten dollars and the annual
license fee for each such station shall be twenty dollars, and (c) where
such a station is at the premises of a specified employer for the
purpose of cashing checks, drafts and money orders for the employees of
such employer, the fees and charges for cashing such checks, drafts or
money orders shall not be subject to the limitations of subdivision one
of section three hundred seventy-two of this chapter if such fees and
charges are paid by such employer.
  3. A licensee may make a written application to the superintendent for
leave to change his place of business, or in the case of a mobile unit,
the area in which such unit is authorized to be operated, stating the
reasons for such proposed change. If the superintendent approves such
application he shall issue a new license in duplicate in accordance with
the provisions of section three hundred sixty-nine of this article,
stating the new location of such licensee or, in the case of a mobile
unit, the new area in which such mobile unit may be operated.

  S 370-a. Changes in control. 1. It shall be unlawful except with the
prior approval of the superintendent for any action to be taken which
results in a change of control of the business of a licensee. Prior to
any change of control, the person desirous of acquiring control of the
business of a licensee shall make written application to the
superintendent and pay an investigation fee of two hundred fifty dollars
to the superintendent. The application shall contain such information as
the superintendent, by rule or regulation, may prescribe as necessary or
appropriate for the purpose of making the determination required by
subdivision two of this section. 

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Article 9-A, Continued . . .

  2. The superintendent shall approve or disapprove the proposed change
of control of a licensee in accordance with the provisions of
subdivisions one and six of section three hundred sixty-nine of this
article. The superintendent shall approve or disapprove the application
in writing within ninety days after the date the application is filed
with the superintendent.
  3. For a period of six months from the date of qualification thereof
and for such additional period of time as the superintendent may
prescribe, in writing, the provisions of subdivisions one and two of
this section shall not apply to a transfer of control by operation of
law to the legal representative, as hereinafter defined, of one who has
control of a licensee. Thereafter, such legal representative shall
comply with the provisions of subdivisions one and two of this section.
The provisions of subdivisions one and two of this section shall be
applicable to an application made under such section by a legal
representative.
  The term "legal representative", for the purposes of this section,
shall mean one duly appointed by a court of competent jurisdiction to
act as executor, administrator, trustee, committee, conservator or
receiver, including one who succeeds a legal representative and one
acting in an ancillary capacity thereto in accordance with the
provisions of such court appointment.
  4. As used in this section: (a) the term "person" includes an
individual, partnership, corporation, association or any other
organization, and (b) the term "control" means the possession, directly
or indirectly, of the power to direct or cause the direction of the
management and policies of a licensee, whether through the ownership of
voting stock of such licensee, the ownership of voting stock of any
person which possesses such power or otherwise. Control shall be
presumed to exist if any person, directly or indirectly, owns, controls
or holds with power to vote ten per centum or more of the voting stock
of any licensee or of any person which owns, controls or holds with
power to vote ten per centum or more of the voting stock of any
licensee, but no person shall be deemed to control a licensee solely by
reason of being an officer or director of such licensee or person. The
superintendent may in his discretion, upon the application of a licensee
or any person who, directly or indirectly, owns, controls or holds with
power to vote or seeks to own, control or hold with power to vote any
voting stock of such licensee, determine whether or not the ownership,
control or holding of such voting stock constitutes or would constitute
control of such licensee for purposes of this section.

  S 371. Regulations. The superintendent is hereby authorized and
empowered to make such rules and regulations, and such specific rulings,
demands, and findings as he may deem 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.

  S 372. Fees and charges; posting schedule; records. 1. The
superintendent shall, by regulation, establish the maximum fees which
may be charged by licensees for cashing a check, draft, or money order.
No licensee shall charge or collect any sum for cashing a check, draft,
or money order in excess of that established by the superintendent`s
regulations.
 
  2. The schedule of fees and charges permitted under this section shall
be conspicuously and continuously posted in every location and mobil
unit licensed under this article.
  3. No change in fees shall become effective earlier than thirty days
after the superintendent shall notify the majority leader of the senate,
the speaker of the assembly, and the chairmen of both the senate and
assembly committees on banks of his intention to change fees.
  4. The fees in effect immediately prior to the effective date of this
subdivision shall continue to be the maximum allowable fees until
revised by the superintendent`s regulations.
  5. Each licensee shall keep and use in its business such books,
accounts, and records as the superintendent may require to carry into
effect the provisions of this article and the rules and regulations made
by the superintendent hereunder. Every licensee shall preserve such
books, accounts and records for at least two years.
  6. Before a licensee shall deposit with any banking organization, or
with any organization engaged in the business of banking, a check, draft
or money order cashed by such licensee, the same must be endorsed with
the actual name under which such licensee is doing business and must
have the words "licensed casher of checks" legibly written or stamped
immediately after or below such name.

  S 373. Acts prohibited; suspension or revocation of license;
penalties.  1. No licensee shall engage in the business of making loans
of money, credit, goods or things or discounting of notes, bills of
exchange, checks, or other evidences of debt pursuant to the provisions
of article nine of this chapter, nor shall a loan business or the
negotiation of loans or the discounting of notes, bills of exchange,
checks or other evidences of debt be conducted on the same premises
where the licensee is conducting business pursuant to the provisions of
this article. No licensee shall at any time cash or advance any moneys
on a post-dated check or draft or engage in the business of transmitting
money or receiving money for transmission; provided, however, that a
licensee may cash a check payable on the first banking business day
following the date of cashing (a) if such check is drawn by the United
States, the state of New York, or any political subdivision of the state
of New York, or by any department, bureau, agency, authority,
instrumentality or officer, acting in his official capacity, of the
United States or of the state of New York or of any political
subdivision of the state of New York, or (b) if such check is a payroll
check drawn by an employer to the order of its employee in payment for
services performed by such employee. No licensee shall cash any check,
draft or money order if the face amount for which it is drawn is in
excess of six thousand dollars; provided, however, that this restriction
shall not apply to the cashing of checks, drafts or money orders drawn
by the United States, any state thereof or any political subdivision of
any such state, or by any department, bureau, agency, authority,
instrumentality or officer, acting in his official capacity, of the
United States, any state thereof or any political subdivision of any
such state, or any banking institution, or to any check or draft drawn
by any insurance company, any broker or dealer registered with the
securities and exchange commission, or any attorney for the settlement
of claims, or to any check which has been certified by the banking
institution on which it has been drawn.  For purposes of this
subdivision, "banking institution" means any bank, trust company,
savings bank, savings and loan association or credit union which is
incorporated, chartered or organized under the laws of this state or any
other state or the United States.
  2. The superintendent may suspend or revoke any license or licenses
issued pursuant to this article if, after notice and a hearing, he shall
find that the licensee (a) has committed any fraud, engaged in any
dishonest activities or made any misrepresentation; or (b) has violated
any provisions of the banking law or any regulation issued pursuant
thereto, or has violated any other law in the course of its or his
dealings as a licensed casher of checks; or (c) has made a false
statement in the application for such license or failed to give a true
reply to a question in such application; or (d) has demonstrated his or
its incompetency or untrustworthiness to act as a licensed casher of
checks; or (e) is not doing sufficient business pursuant to this article
to justify the continuance of the license, or if he shall find that any
ground or grounds exist which would require or warrant the refusal of an
application for the issuance of the license if such an application were
then before him. Such a hearing shall be held in the manner and upon
such notice as may be prescribed by the superintendent. Pending an
investigation or a hearing for the suspension or revocation of any
license or licenses issued pursuant to this article, the superintendent
may temporarily suspend such license or licenses for a period not to
exceed ninety days, provided the superintendent shall find that such a
temporary suspension is in the public interest.
  3. Whenever the superintendent shall suspend or revoke a license
issued pursuant to this article, he shall forthwith execute a written
order to that effect. The superintendent shall on the date such order is
executed file one copy thereof in the office of the department and serve
a second copy thereof on the licensee either personally or by mailing
the same to the last known address of such licensee. Such order shall be
subject to review by the supreme court in the manner provided in article
seventy-eight of the civil practice law and rules; provided, however,
that a special proceeding for review of such order must be commenced
within thirty days from the date of such order of suspension or
revocation and, provided further, that no stay shall be granted pending
the determination of the matter except on notice to the superintendent
and for a period not exceeding thirty days.
  4. Any person, partnership, association or corporation and the several
members, officers, directors, agents and employees thereof, who shall
violate any of the provisions of this article, shall be guilty of a
misdemeanor, and shall be punishable by imprisonment for not more than
one year or by a fine of not more than five hundred dollars, or by both
such fine and imprisonment.

  S 374. Application of article. 1. The provisions of this article shall
not apply when checks, drafts or money orders are cashed, other than by
a licensee, without a consideration or charge; nor when checks, drafts
or money orders are cashed, other than by a licensee, as an incident to
the conduct of any other lawful business where not more than one dollar
is charged for cashing each check, draft or money order; nor shall the
provisions of this article apply to any national bank, federal reserve
bank, or to any person, partnership, association, corporation or other
organization doing business under or pursuant to the provisions of this
chapter, except a licensee under this article.
  2. The provisions of this article shall apply to the operation of
electronic check cashing machines. No person, partnership, association,
corporation or other organization required to be licensed under this
article shall operate an electronic check cashing machine without being
duly licensed by the superintendent to engage in such business pursuant
to this article.
  * 3. Notwithstanding the provisions of subdivisions one and two of
this section, no national bank or any person, partnership, association,
corporation or other organization doing business under or pursuant to
the provisions of this chapter, except a licensee under this article,
shall conduct the business of cashing checks at a separate location
which is used primarily by any such entity for the purpose of cashing
checks, or at a separate location by means of an electronic check
cashing machine, unless such separate location is not closer than one
thousand five hundred eighty-four feet (three-tenths of a mile) from an
existing licensee; provided however that this restriction shall not
apply to any separate location which was in operation prior to the
effective date of this subdivision nor shall it apply to any national
bank or any person, partnership, association, corporation or other
organization doing business under or pursuant to the provisions of this
chapter which was engaged in the business of electronic check cashing
machines in this state prior to the effective date of this subdivision.
  * NB Repealed February 8, 2008
  4. Notwithstanding the provisions of article four-A of this chapter
and any rules or regulations adopted thereunder, a public accommodation
office shall be deemed a separate location for purposes of subdivision
three of this section if such office is used primarily for the purpose
of cashing of checks. A public accommodation office, for purposes of
this subdivision, shall include, without limitation, both those public
accommodation offices for which regulatory approval is required and
those public accommodation offices for which regulatory approval is not
required. The provisions of this subdivision shall be deemed to apply to
any similar facility established by a national bank.
  

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