2023 New York Laws › BNK - Banking › Article 1 - Short Title; Definitions; Miscellaneous Provisions. › 9-Y - Order of Payment of Checks and Other Debits, Insufficient Funds Charges and Return Deposit Item Charges.

§ 9-y. Order of payment of checks and other debits, insufficient funds
charges  and return deposit item charges. 1. Order of paying checks. (a)
Notwithstanding any law, rule  or  regulation  to  the  contrary,  every
banking   organization  that  provides  checking  services  to  consumer
accounts shall either pay checks in the order wherein they are  received
or  pay  checks from smallest to largest dollar amount for each business
day's transactions.
(b) If a check is dishonored for  insufficient  funds  and  thereafter
smaller  checks  which  could  be  paid are received, the smaller checks
shall be honored within amounts on deposit in the subject account.
(c) The banking organization shall disclose to  consumers  in  writing
the  order  in  which  checks are drawn. The written disclosure shall be
provided to the consumer at the time the account is opened and prior  to
any change in such policy.
(d)   The   superintendent  shall  promulgate  rules  and  regulations
necessary for the implementation of this section.
2. Regulation of other consumer account  transactions  and  associated
fees.  (a)  The  superintendent  shall  have  the  power to prescribe by
regulation:
i. the manner in which banking organizations process debit and  credit
transactions,  other  than  those  specified  in subdivision one of this
section, for consumer accounts maintained at such organization;
ii. the charges that may be imposed in connection with a  check  drawn
or  other  written  order  upon,  or  electronic  transfer  sought to be
effectuated against, insufficient funds or  uncollected  balances  in  a
consumer  account,  whether  or  not  the banking organization pays such
check, written order, or electronic transfer;
iii. the charges that may be imposed in connection  with  a  check  or
other  written  order  received by a banking organization for deposit or
collection drawn against a consumer account and subsequently  dishonored
and returned for any reason by the drawee;
iv.  disclosures  provided  to  consumers  regarding the processing of
transactions in a consumer account and the associated fees; and
v. alerts, notices, and other disclosures relating to  the  imposition
or  possible  imposition of a charge as provided in subparagraphs ii and
iii of this paragraph.
(b) In prescribing regulations regarding the manner in  which  banking
organizations  process debit or credit transactions, or the charges that
may be imposed pursuant to subparagraphs ii or iii of paragraph  (a)  of
this  subdivision,  the superintendent shall consider, at a minimum, the
following factors:
i. the cost incurred by the banking  organization,  in  providing  any
services associated with such charges;
ii. the competitive position of the banking organization; and
iii.  the  maintenance  of  a safe and sound banking organization that
protects the public interest.
3. Definition. As used in  this  section,  "consumer  accounts"  means
accounts   at  banking  organizations  established  by  natural  persons
primarily for personal, family or household purposes.