NY Lawmakers Approve Legislation Against Financial Fraud
Michael Gianaris, Deputy Leader of the Senate, recently announced his legislative measures to protect citizens of New York from becoming a target of financial fraud. The Senate passed the legislation on April 21st.
“New Yorkers deserve the strongest protections against predators and fraud. With the COVID-19 crisis, scams are on the rise,” said Senate Deputy Leader Gianaris. “We need the strongest possible defences to keep consumers and their wallets safe, and I am pleased the Senate is passing this bill today.”
The new measures by Senator Gianaris mandate the financial institutes to give warning to all their customers about the risks of consumer scams when they are transferring the funds.
Assemblyman Al Stirpe (D-Cicero) said: “Every day, elderly and economically vulnerable people in my district and across the state are called, emailed and texted by scam artists hoping to take advantage of their trust. This legislation would help prevent some of the scams that involve wire transfers, and it is a small but important step to protect these consumers and all of us. I am honoured to sponsor this bill in the Assembly and pleased to see it one step closer to adoption.”
Section 1 of the law reforms the banking law by affixing a new section 652-c. This section mandates the money transmission businesses to explicitly warn the consumers of any possibility of fraud before completing the transfer. The warnings should be of a bold title in capital letters such as “WARNING: DO NOT FALL VICTIM TO CONSUMER FRAUD.”
The Senate believes that consumer fraud is bound to hurt everyone and the responsibility of ensuring secure operations for consumers as well as themselves befalls the financial institution. The elderly people are especially a vulnerable target of such fraud in the transfer of money. Sometimes people are misled to believe that they have won the lottery or they have been offered a great deal and they can avail of the offer by just simply transferring money to an uncertain address. By doing so, people end up losing hundreds of dollars.
Sometimes, such frauds use people as money mules and involve them and the financial institutions in their money laundering schemes. This bill requires financial institutions to take measures including warning their customers about the risks in transmission of money. This will help to ensure less risk in the money transfer business.