BILL NUMBER: S6388
SPONSOR: HARCKHAM
 
TITLE OF BILL:
An act to amend the general business law, in relation to providing for
electronic notice for collateral loan brokers
 
PURPOSE:
Provides for electronic (email or text message) notice of intention to
sell defaulted pledges and notice of surplus, reserving the borrower the
right to receive a written notice by mail in the alternative.
 
SUMMARY OF PROVISIONS:
Section 1 amends section 49 subdivision 1 of the general business law to
allow electronic notice of intention to sell collateral, by email or
text message, when a pledgor has defaulted on a loan.
Section 2 amends section 50 subdivision 2 of the general business law to
require notice of surplus money following the sale transmitted to pled-
gor in the same medium as the notice of sale.
Section 3 states the effective date.
 
JUSTIFICATION:
Technological developments in daily life have led consumers and busi-
nesses to replace transactions and communications conducted tradi-
tionally on paper with electronic mediums (text message or email). New
York law requires paper documents for collateral loan communications
between lender and borrower, limiting modern preference between parties
and hindering critical communication.
This legislation also still allows customers who prefer to receive a
potential notice of sale (and notice of surplus) to elect to receive
both present and future notices by traditional mail at no cost or obli-
gation. This bill is intended to have statewide application notwith-
standing any general or special statutes, local laws and ordinances to
the contrary.
 
LEGISLATIVE HISTORY:
2023-2024: S8131/A9784 - Died in Consumer Protection/Died in Consumer
Affairs & Protection
 
FISCAL IMPLICATIONS:
Minimal; TBD
 
EFFECTIVE DATE:
This act shall take effect on the one hundred eightieth day after it
shall have become a law. Effective immediately, the addition, amendment
and/or repeal of any rule or regulation necessary for the implementation
of this act on its effective date are authorized to be made and
completed on or before such effective date.

Statutes affected:
S6388: 49 general business law, 49(1) general business law, 50 general business law, 50(2) general business law