Relates to prohibited unlicensed activities

Latest action Dec 5, 2025

Provides that persons engaged in activity for which a license or other authorization from the superintendent of financial services is required under the banking law or financial services law will be subject to a civil penalty.

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Where it stands

Signed into law.

Introduced
In committee
Up for a vote
Passed one chamber
Passed
Enacted

New York State Senate

Same as A8804, the matching bill in the Assembly.

Amends the Financial Services Law.

Committee

Rules · New York State Assembly

Also referred to Rules · New York State Senate, Ways and Means · New York State Assembly.

Purpose, from the sponsor's memo

Section 1 states the purpose of the bill. Section 2 provides that the Superintendent of Financial Services may hold adjudicatory proceedings to assess civil penalties against persons who have committed prohibited unlicensed acts, as the Superintendent currently may do for other violations of the BL and FSL. Section 3 authorizes the Superintendent of Financial Services to inves- tigate activities that may constitute prohibited unlicensed acts, as the Superintendent currently may do with respect to other activities within the Superintendent's jurisdiction. Section 4 creates a new section of law, FSL § 408-a, which defines "prohibited unlicensed act" and establishes the applicable penalties, which may be assessed by the Superintendent after notice and a hearing. The penalties are as follows For a prohibited unlicensed act that relates to the requirements of the BL or the regulations promulgated thereunder, a new § 408-a(a)(1) estab- lishes that the penalty is the same as the penalty provided in BL § 44 for any violation of the BL. This is consistent with the policy expressed in existing FSL § 408(a)(3)(A) For a prohibited unlicensed act that relates to the requirements of the FSL or the regulations promulgated thereunder, a new FSL § 408-a(a)(2) establishes that the penalty is the same as the penalty provided for in FSL § 408(a) for violations of the FSL or the regulations promulgated thereunder. Additionally, for a prohibited unlicensed act that results in consumer harm, the Superintendent may impose a penalty up to double the amount applicable to such violation provided in FSL §§ 408- a(a)(1) and (a)(2), and the Superintendent may order restitution. Consistent with exiting law, FSL § 408(a)(3)(B), section 4 of the bill also provides that a particular act or omission constituting a prohibit- ed unlicensed act cannot be penalized twice. If the Superintendent imposes a fine for a prohibited unlicensed act pursuant to FSL § 408-a(a)(1) (providing for penalties in connection with BL violations), the Superintendent may not additionally impose a penalty for the same act or omission pursuant to FSL § 408-a(a)(2) (providing for penalties in connection with FSL violations). If the Superintendent imposes a penalty pursuant to FSL § 408(a)(1) or (2), the Superintendent may not impose a penalty pursuant to FSL § 408-a(a)(2). Also consistent with existing law, this section establishes that the civil penalties that the Superintendent collects for prohibited unli- censed acts must be applied in the same manner as civil penalties received by the Superintendent for other violations of the FSL. Section 5 of the bill provides, consistent with existing law, that if the Superintendent believes that a violation of the newly created FSL § 408-a has been attempted or committed, the Superintendent, in their discretion, may report such activity to the appropriate licensing authority or district attorney or to the New York State Attorney Gener- al. Section 6 of the bill provides an immediate effective date.

Filed with the bill. Read it on nysenate.gov (opens in a new tab)

Recorded votes

Vote: Committee vote · Rules
Senate RulesJun 12, 2025Result: passed
(20) (0) (0) (1)
Vote: Floor vote
NY SenateJun 12, 2025Result: passed
(59) (0) (0) (4)

The sponsor's argument

Why Liz Krueger says this is needed

Currently, unlicensed entities engaging in most types of business requiring a license under the Banking Law and certain types of business requiring a license under the Financial Services Law and regulations are not subject to the Superintendent's power to impose civil monetary penalties for a failure to be properly licensed or for violations of other provisions of the Banking Law and Financial Services Law that govern the conduct of those businesses. In other words, a person or entity lacking a required license is not subject to penalty for acts that would constitute violations subject to penalty if the person did have proper authorization. Furthermore, the entity is not subject to a financial penalty for failure to be properly licensed. This bill will resolve these faults that disincentivize compliance with licensing requirements by illogically advantaging persons who disregard licensing, registration, and similar authorization requirements over those persons who comply with such requirements by obtaining proper authorization and subjecting themselves to Departmental supervision.

This is the sponsor's own case for the bill, quoted from their memorandum. It is not Agora's description of what the bill does.

Full history

Dec 5, 2025
Signed
SIGNED CHAP.610
NY Senate
Dec 1, 2025
Sent to the executive
DELIVERED TO GOVERNOR
NY Senate
Jun 13, 2025
Ordered to Third Reading Rules CAL.696
ORDERED TO THIRD READING RULES CAL.696
NY Assembly
Jun 13, 2025
Passed a chamber
PASSED ASSEMBLY
NY Assembly
Jun 13, 2025
Substituted
SUBSTITUTED BY S8408
NY Assembly

Show full history (9 earlier events)

Jun 12, 2025
Sent to the executive
DELIVERED TO ASSEMBLY
NY Senate
Jun 12, 2025
Ordered to Third Reading CAL.1945
ORDERED TO THIRD READING CAL.1945
NY Senate
Jun 12, 2025
Passed a chamber
PASSED SENATE
NY Senate
Jun 12, 2025
Referred to committee
REFERRED TO WAYS AND MEANS
NY Assembly
Jun 12, 2025
Reported out of committee
REPORTED
NY Assembly
Jun 12, 2025
Rules Report CAL.696
RULES REPORT CAL.696
NY Assembly
Jun 11, 2025
Reported out of committee
REPORTED REFERRED TO RULES
NY Assembly
Jun 9, 2025
Referred to committee
REFERRED TO RULES
NY Senate
Jun 9, 2025
Referred to committee
REFERRED TO WAYS AND MEANS
NY Assembly

About this record

Summary: The summary comes from NY Open Legislation, the New York State Senate's public record. For more, see How we handle summaries.
Source: From NY Open Legislation, the NY Senate and Assembly, and official rosters. This record was last updated Oct 22, 2026. About our data

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Read on NY Senate (opens in a new tab) The official record on nysenate.gov.

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