S9383A

Senate Print 9383A, a bill to amend the Banking Law, was laid aside on a motion by Sen. Lanza during floor consideration. The bill did not proceed to a vote.

The Senate passed legislation amending the Banking Law to combat fraud in joint bank accounts, with a 40-21 vote. The bill, sponsored by Sen. Sanders, would require account holders to clearly designate beneficiaries upon death through a new signature card process, rather than defaulting to joint account holders. The measure applies only to state-chartered banks and requires banks to make two good-faith attempts to notify existing account holders of the new process, with no penalty if customers fail to comply. Sen. Sanders cited a personal example of a relative whose girlfriend kept all funds after his death, arguing the bill protects average New Yorkers who cannot afford lawyers. He noted that more than 20 states have already adopted similar protections. However, opponents including Sen. Borrello and Sen. Martins raised concerns about implementation burden on community banks, lack of clear liability protections, and the impact on low-income account holders. They argued the bill addresses an estate planning issue rather than a banking issue and noted that federally chartered banks would not be affected, creating an uneven system. The bill takes effect July 1, 2025.