BILL NUMBER: S4579
SPONSOR: HOYLMAN-SIGAL
 
TITLE OF BILL:
An act to amend the banking law, in relation to prohibiting bank invest-
ments in bad faith landlords
 
PURPOSE:
To prevent landlords convicted of fraud or violating housing laws from
receiving financing from state-chartered banks.
 
SUMMARY OF PROVISIONS:
Section one prevents state chartered banking institution from providing
financing or investing in any person or business entity engaged in leas-
ing residential real estate if the person or entity has been convicted
of illegal conduct against a tenant, convicted of financial fraud or
embezzlement, or has entered into certain consent decrees with the
office of the attorney general.
Section two establishes the effective date.
 
JUSTIFICATION:
When a landlord is found time and again to disregard housing law and
target tenants with harassment, it is reasonable to expect financial
institutions to analyze this record when considering future financing.
Certain bad actors have been convicted of illegal harassment, coercion,
or fraud against tenants, only to turn around and get financing for a
new building to exploit.
Perhaps the most notorious example of this phenomenon has been Steve
Croman, the New York City landlord who in 2017 was sentenced to one year
of jail time and ordered to pay $8 million in restitution to tenants for
his crimes. A consent decree required that Croman place over 100 of his
properties under new independent management, with a monitor in place to
oversee compliance. However, after his stint in jail, Croman returned
only to go on a buying spree of new buildings. Despite his past legal
troubles, tenants report a landlord that continues old patterns of
harassment and neglect.
This bill would help address the lack of accountability by prohibiting
State chartered banks from issuing loans to landlords that have been
convicted of violating housing laws. Bad actors that act with impunity
should not be given the chance to continue victimizing New Yorkers.
 
LEGISLATIVE HISTORY:
S.5401 of 2023-2024 (Hoylman-Sigal): Died in Banks
S.7609 of 2021-2022 (Hoylman): Died in Banks
 
FISCAL IMPLICATIONS:
None.
 
EFFECTIVE DATE:
This act shall take effect immediately.