HIGHTSTOWN, N.J. (1/21/16)--New Jersey Credit Union League-requested legislation that will authorize New Jersey credit unions and banks to offer savings promotions, also known as prize-linked savings (PLS) accounts, was signed into law Tuesday by Gov. Chris Christie.
The legislation was sponsored by Sens. Richard Codey (D-Livingstone) and Ronald Rice (D-Newark), and by Assemblymen Herb Conaway (D-Delran), Troy Singleton (D-Mount Laurel), Tim Eustace (D-Paramus) and Craig Coughlin (D-Woodbridge).
Intended to provide incentives for depositors to open and maintain savings accounts, the legislation (S-2495/A-3868) authorizes New Jersey credit unions, banks and savings banks to conduct promotions in which a minimum deposit in an amount predetermined by the institution qualifies for a chance to win prizes.
Legislation to allow federally chartered financial institutions to offer PLS accounts was signed into law by President Barack Obama in December 2014.
The New Jersey bill enables state-chartered institutions to offer the accounts. It also clarifies that such savings promotion programs conducted by either state or federally chartered institutions do not constitute unlawful gambling under New Jersey law, and are not subject to any laws concerning legalized games of chance presently in statute.
The legislation essentially takes effect six months from signing. Interested credit unions should be able to offer PLS accounts beginning in the third quarter of this year.
With the New Jersey legislation, 16 states are authorized to conduct prize-linked savings programs. Other states include Michigan, Rhode Island, Maine, Washington, North Carolina, Nebraska, Maryland, Connecticut, Indiana, New York, Arkansas, Illinois, Minnesota, Oregon and Virginia.