S 4579: Prohibits a state chartered banking institution from providing financing to a landlord who has engaged in certain bad faith acts.

  
  STATE OF NEW YORK ________________________________________________________________________ 4579 2025-2026 Regular Sessions  IN SENATE February 7, 2025 ___________ Introduced by Sens. HOYLMAN-SIGAL, JACKSON -- read twice and ordered printed, and when printed to be committed to the Committee on Banks AN ACT to amend the banking law, in relation to prohibiting bank invest- ments in bad faith landlords The People of the State of New York, represented in Senate and Assem- bly, do enact as follows: 1 Section 1. The banking law is amended by adding a new section 13 to 2 read as follows: 3 § 13. Investments in bad faith landlords by state chartered banking 4 institutions. 1. No state chartered banking institution shall provide 5 financing for or invest in the stocks, securities, or other obligations 6 of any person, institution, company, or subsidiary engaged in the busi- 7 ness of leasing residential real estate that has: 8 (a) Been convicted of engaging in illegal conduct against a tenant, 9 including (i) harassment, (ii) coercion, or (iii) fraud; 10 (b) Been convicted of fraudulent refinancing of loans, tax fraud, 11 embezzlement, or other fraud or theft related to financial management; 12 or 13 (c) Entered into a consent decree with the office of the attorney 14 general in settlement of a lawsuit regarding unfair or deceptive prac- 15 tices against a tenant, that (i) establishes a tenant restitution fund, 16 pursuant to subdivision twelve of section sixty-three of the executive 17 law, with total contributions in excess of one million dollars, (ii) 18 results in an independent property management company acquiring the 19 primary management responsibilities of any of the respondent's proper- 20 ties, or (iii) requires a monitor to engage in the review of the 21 respondent's compliance with the policies and provisions of such a 22 decree. 23 2. For purposes of this section: 24 (a) "State chartered banking institution" shall have the same meaning 25 as defined in subdivision one of section twelve-a of this article; EXPLANATION--Matter in italics (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD04008-01-5 
 S. 4579 2 1 (b) "Consent decree" shall mean an agreement between the parties in an 2 action to resolve the action, which is entered, approved, and ordered by 3 a court; 4 (c) "Tenant restitution fund" shall mean a fund, trust, or account in 5 which money is deposited for the benefit of potential claimants who 6 qualify for restitutions under the court action that led to the creation 7 of the tenant restitution fund and the office of the attorney general 8 shall have oversight of the fund and be responsible for making distrib- 9 utions to claimants; 10 (d) "Property management company" shall mean a company that is not 11 owned by a party to the consent decree that is qualified to manage the 12 properties that are subject to a consent decree; and 13 (e) "Monitor" shall mean an individual who has been approved by the 14 office of the attorney general to review and report on whether the other 15 party to the consent decree and/or the property management company 16 comply with the policies and provisions of the consent decree. 17 § 2. This act shall take effect immediately and shall apply to all 18 contracts entered into, renewed, modified or amended on or after such 19 effective date.