SRC-JBJ H.B. 2800 76(R)   BILL ANALYSIS


Senate Research Center   H.B. 2800
76R5841 CLG-DBy: Driver (Carona)
Education
5/13/1999
Engrossed


DIGEST 

Current, a holder of a dishonored check written on a business checking
account may be unable to locate the person to whom the check was written.
Possibly, the name of the business owner is not on the check, the address
on the check is not a physical address, or the business owner or business
has moved from the address on the check.  Under current law, if the
financial institution that returned the check has any of this information,
it is unclear whether or not the institution may provide the information to
the holder of the dishonored check.  H.B. 2800 would require a financial
institution to maintain certain information regarding a business account
holder and would prohibit the institution from withholding the information
if it is requested by a person who received a dishonored check. 

PURPOSE

As proposed, H.B. 2800 requires a financial institution to maintain certain
information regarding a business account holder, and prohibits the
institution from withholding information on a dishonored check. 

RULEMAKING AUTHORITY

This bill does not grant any additional rulemaking authority to a state
officer, institution, or agency. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Title 3Z, Finance Code, by adding Chapter 377, as
follows: 

CHAPTER 277.  BUSINESS CHECKING ACCOUNTS

Sec. 277.001.  DEFINITIONS.  Defines "business," "business checking
account," and "financial institution." 

Sec. 277.002.  ACCOUNT INFORMATION REQUIRED.  Requires a financial
institution to require an applicant for a business checking account to
provide certain information about the business owner, as a condition of
opening the account, and to keep the information current at least annually. 

Sec. 277.003.  DISCLOSURE OF INFORMATION.  Prohibits a financial
institution from unreasonably withholding the information recorded under
Section 277.002 to a person who received a dishonored check or draft from
the institution and from withholding a photocopy of the dishonored check or
draft.  Authorizes the institution to assess a research fee on the person
requesting the information under this section.  Provides that the
institution is not liable to an account holder or other person for the
disclosure of information under this section. 

SECTION 2.Effective date: September 1, 1999.
  Makes application of this Act prospective.

SECTION 3.Emergency clause.