Prohibits State Chartered Banking Institutions from Investing in and Providing Financing for Private Prisons
Summary
Senator Cordell Cleare introduced S114 in the New York Senate, which would prohibit state-chartered banking institutions from investing in or providing financing for private prisons. The bill passed the Senate and would add a new section 12 to the State Banking Law, incorporating by reference Section 121 of the Correction Law as the standard for prohibited facilities. The legislation takes effect immediately upon enactment and applies to contracts entered into, renewed, modified, or amended on or after the effective date.
State-chartered banks in New York with existing financing arrangements for private prison operators should assess whether those arrangements would be grandfathered. The bill applies the Section 121 of the Correction Law standard to out-of-state facilities, which means the prohibition extends beyond New York's borders when the facility's operation would violate Correction Law if located in-state.
What changed
S114 proposes to add a new Section 12 to the New York State Banking Law prohibiting state-chartered banking institutions from providing financing for or investing in the stocks, securities, or other obligations of any entity that owns or operates a private correctional facility. The bill incorporates by reference the standards in Section 121 of the Correction Law to determine which facilities would be prohibited.
State-chartered banks in New York should monitor the bill's progress through the Assembly and potential signing by the Governor. If enacted, the prohibition would apply immediately to new contracts and to renewals, modifications, or amendments of existing contracts entered into after the effective date.
Archived snapshot
Apr 21, 2026GovPing captured this document from the original source. If the source has since changed or been removed, this is the text as it existed at that time.
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Senate
Bill
S114
2025-2026 Legislative Session Prohibits state chartered banking institutions from investing in and providing financing for private prisons
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Sponsored By
Cordell Cleare
(D) 30th Senate District
Current
Bill Status
- Passed Senate
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co-Sponsors
Samra G. Brouk
(D, WF) 55th Senate District
Robert Jackson
(D, WF) 31st Senate District
Rachel May
(D, WF) 48th Senate District
2025-S114
(ACTIVE)
- Details
See Assembly Version of this Bill: A4144 Law Section: Banking Law Laws Affected: Add §12, Bank L Versions Introduced in Other Legislative Sessions: 2019-2020: S8722, A7580
2021-2022: S1015, S8073, A7112
2023-2024: S205, A6601
2025-S114
(ACTIVE)
- Summary
Prohibits state chartered banking institutions from investing in and providing financing for private prisons.
2025-S114
(ACTIVE)
- Sponsor Memo
BILL NUMBER: S114
SPONSOR: CLEARE
TITLE OF BILL:
An act to amend the banking law, in relation to prohibiting state char-
tered banking institutions from investing in and providing financing for
private prisons
PURPOSE:
This bill prohibits New York state-chartered banks from financing
private prisons.
SUMMARY OF PROVISIONS:
This bill adds a new section 12 to the State Banking Law to prohibit New
York State chartered banking institutions from financing private pris-
ons.
EXISTING LAW:
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2025-S114
(ACTIVE)
- Bill Text download pdf
S T A T E O F N E W Y O R K
114
2025-2026 Regular Sessions
I N S E N A T E
(PREFILED)
January 8, 2025
Introduced by Sens. CLEARE, BROUK, JACKSON, MAY -- read twice and
ordered printed, and when printed to be committed to the Committee on
Banks
AN ACT to amend the banking law, in relation to prohibiting state char-
tered banking institutions from investing in and providing financing
for private prisons
THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:
Section 1. The banking law is amended by adding a new section 12 to
read as follows:
§ 12. INVESTMENTS IN PRIVATE PRISONS BY STATE CHARTERED BANKING INSTI-
TUTIONS. 1. NO STATE CHARTERED BANKING INSTITUTION SHALL PROVIDE FINANC-
ING FOR OR INVEST IN THE STOCKS, SECURITIES, OR OTHER OBLIGATIONS OF ANY
ENTITY THAT OWNS OR OPERATES A PRIVATE CORRECTIONAL FACILITY FOR HOUSING
INCARCERATED INDIVIDUALS THAT WOULD BE PROHIBITED UNDER SECTION ONE
HUNDRED TWENTY-ONE OF THE CORRECTION LAW IF SUCH FACILITY WERE LOCATED
IN THIS STATE.
2. FOR PURPOSES OF THIS SECTION "BANKING INSTITUTION" SHALL HAVE THE
SAME MEANING AS DEFINED IN PARAGRAPH (B) OF SUBDIVISION THREE OF SECTION
NINE-F OF THIS CHAPTER.
§ 2. This act shall take effect immediately and shall apply to all
contracts entered into, renewed, modified or amended on or after such
effective date.
EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD00211-01-5
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