It is the court’s opinion that the amended statute requires a landlord to deposit rent security funds in an interest-bearing bank account, regardless of when acquired, beginning with September 1, 1970.
Respondents challenge the Attorney-General’s standing to bring this suit. They refer to the opinion in Matter of State of New York v. Parkchester Apts. (61 Misc 2d 1020, affd. 34 A D 2d 1106) which was affirmed by the Court of Appeals on the opinion of Mr. Justice Sarafite at Special Term (28 N Y 2d 842).
In Parkchester, the Metropolitan Life Insurance Co. had voluntarily deposited .security moneys of the more than 12,000 tenants of Parkchester in interest-bearing accounts. Upon the sale of Parkchester, the purchasers transferred such security moneys from interest-bearing’ accounts to noninterest-bearing’ accounts. The Attorney-General charged that such action was fraudulent and illegal conduct. He instituted a proceeding to compel the return of the tenants’ securities into interest-bearing accounts as before.
In that suit there was no statute upon which fraud or illegality could be based. The Attorney-General did not argue that section 7-103 by itself alone imposed an obligation upon the landlord to keep the money at interest. The thrust of the Attorney-General ’.s argument was that the purchasers were fiduciaries who were required to use the funds productively but were using the security money for their own economic advantage, to the detriment of the tenants who previously were credited by Metropolitan Life Insurance Co. with interest on their security money.