§ 5-531 — Brokerage on loans; recovery of excess; effect of restitution

New York § 5-531

• Jurisdiction: New York
• Law GOB: General Obligations
• Title 5: Interest and Usury; Brokerage On Loans
• Art. 5: Creation, Definition and Enforcement of Contractual Obligations

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§ 5-531. Brokerage on loans; recovery of excess; effect of\nrestitution. 1. No person shall, directly or indirectly, take or receive\nmore than fifty cents for a brokerage, soliciting, driving or procuring\nthe loan or forbearance of one hundred dollars, and in that proportion\nfor a greater or less sum, except loans on real estate security; nor\nmore than thirty-eight cents for making or renewing any bond, bill, note\nor other security given for such loan or forbearance, or for any counter\nbond, bill, note or other security concerning the same.\n 2. For the purposes of this section:\n a. "Consumer" means a natural person.\n b. "Loan broker" means any individual, firm, corporation, or\npartnership who agrees for a fee to obtain a loan or credit for a\nconsumer or to assist a consumer in obtaining a loan or credit, other\nthan a loan or credit on real estate security.\n c. No loan broker shall solicit, receive or collect from a consumer\nthe fee authorized by subdivision one of this section in advance of the\ndisbursement of loan proceeds or the extension of credit to a consumer.\n d. No loan broker shall solicit, receive or collect from a consumer\nany fee, advance payment or compensation of any nature other than the\nfee authorized by subdivision one of this section.\n 3. a. Every person who shall pay, deliver or deposit any money,\nproperty or thing in action, over and above the rate aforesaid, and his\npersonal representatives may, within three years after such payment,\ndelivery or deposit, sue for and recover the same of the person so\ntaking or receiving such money, property or thing in action, or of his\npersonal representatives. Judgment may be entered in favor of a consumer\nin an amount not to exceed three times the actual damages plus\nreasonable attorneys' fees.\n b. In case such suit shall not be brought within the time above\nprescribed, in good faith, or in case it shall be discontinued, or\nwillfully delayed, then the public welfare officials of the city or town\nwhere the offense was committed, may, within one year after such\nneglect, discontinuance or delay, sue for and recover the money,\nproperty or thing in action, so received, delivered or deposited, from\nthe person receiving the same, or his personal representatives, for the\nuse of the poor of the county.\n c. In addition to the other remedies provided, whenever there shall be\na violation of subdivision two of this section, application may be made\nby the attorney general in the name of the people of the state of New\nYork to a court or justice having jurisdiction by a special proceeding\nto issue an injunction, and upon notice to the defendant of not less\nthan five days, to enjoin and restrain the continuance of such\nviolations; and if it shall appear to the satisfaction of the court or\njustice that the defendant has, in fact, violated this article, an\ninjunction may be issued by such court or justice, enjoining and\nrestraining any further violation, without requiring proof that any\nperson has, in fact, been injured or damaged thereby. In any such\nproceeding, the court may make allowances to the attorney general as\nprovided in paragraph six of subdivision (a) of section eighty-three\nhundred three of the civil practice law and rules, and direct\nrestitution. Whenever the court shall determine that a violation of this\narticle has occurred, the court may impose a civil penalty of not more\nthan one thousand dollars for each violation. In connection with any\nsuch proposed application, the attorney general is authorized to take\nproof and make a determination of the relevant facts and to issue\nsubpoenas in accordance with the civil practice law and rules.\n