New York Banking Law

Article 13-A
licensees: Superintendent`s Taking Possession:
Conservation: Liquidation

            
Section 635. Definitions.
        636. When superintendent may take possession of license; when
               possession may be surrendered.
        637. Powers of superintendent in possession; application for
               receiver.
        638. Manner and time within which taking possession may be
               tested.
        639. Severability.

  S 635. Definitions. 1. "Person" when used in this article means an
individual, partnership, corporation, unincorporated association, joint
stock association, trust or other group, however organized.
  2. "License" when used in this article means any license duly issued
by the superintendent pursuant to the provisions of article nine,
nine-A, eleven-B, twelve-B, twelve-C, twelve-D or thirteen-B of this
chapter or any registration certificate issued by the superintendent
pursuant to the provisions of article twelve-D of this chapter.
  3. "Licensee" when used in this article means any person issued a
license.

  S 636. When superintendent may take possession of license; when
possession may be surrendered. 1. The superintendent may, in his
discretion, forthwith take possession of the business and property of
any licensee which is used in the business for which the license is
granted whenever it shall appear to the superintendent that in the
conduct of the business for which it has received a license, a clear and
present danger exists to the public because such licensee:
  (a) Is conducting its business in a manner which is unauthorized or
unsafe or which might render its further operations hazardous to the
public;
  (b) Is in an unsafe or unsound condition to transact business;
  (c) Cannot with safety and expediency continue business;
  (d) Has an impairment of its capital, has assets insufficient to pay
its debts and obligations, or is otherwise unable to pay its debts and
obligations as they mature;
  (e) Has suspended payment of some or all of its debts and obligations;
  (f) Has neglected or refused to comply with the terms of a duly issued
order of the superintendent;
  (g) Has refused, upon proper demand, to submit its records and affairs
for inspection to an examiner of the department; or
  (h) Has refused, or any of its officers, directors or partners have
refused, to be examined under oath regarding its affairs.
  2. When the superintendent shall have duly taken possession of the
business and property of any such licensee, he may hold such possession
until its affairs are finally liquidated by him, unless, he shall
surrender possession as provided in subdivision three of this section, a
receiver is appointed by the supreme court pursuant to section six
hundred thirty-seven of this article to liquidate the affairs of the
licensee, or he is enjoined from continuing possession as provided in
section six hundred thirty-eight of this article.

		
  S 637. Powers of superintendent in possession; application for
receiver. 1. When the superintendent has taken possession of the
business and property of a licensee, he shall liquidate or otherwise
deal with such business and property in accordance with the provisions
of article thirteen of this chapter applicable to the possession,
liquidation and conservation of the business and property of a banking
organization.
  2. Whenever the superintendent has taken possession of the business
and property of a licensee, he may, in his discretion, apply to the
supreme court in the judicial district in which such licensee`s
principal office is located for the appointment of a receiver to
liquidate or otherwise deal with the affairs of the licensee. Any
receiver which accepts such appointment may act without bond or other
security as to such appointment and shall have and possess, and may
exercise, all the rights, powers and privileges provided by this article
to the superintendent or by the laws of this state to the superintendent
in his capacity as, or to any other, receiver or liquidator of a banking
organization. 

  S 638. Manner and time within which taking possession may be tested.
At any time within ten days after the superintendent has taken
possession of the business and property of any licensee, such licensee
may apply to the supreme court in the judicial district in which its
principal office is located, for an order requiring the superintendent
to show cause why he should not be enjoined from continuing such
possession. The court may, upon good cause shown, direct the
superintendent to refrain from further proceedings and to surrender such
possession.

  S 639. Severability. If any provision of this article, or the
application of such provision to any person or circumstance shall be
held invalid, the remainder of this article, and the application of such
provision to persons or circumstances other than those to which it is
held invalid, shall not be affected thereby.