N.Y. Educ. Law § 5008

§ 5008. Trust accounts. 1. If the commissioner determines that a\nschool has demonstrated a pattern or practice of failing to make tuition\nrefunds in a timely manner consistent with this article and/or the\nschool's financial condition may result in the interruption or cessation\nof instruction or jeopardize student tuition funds, the commissioner\nshall require a school to establish a trust account in a form or manner\nwhich the commissioner shall determine to be appropriate. The assets or\nfunds contained in the trust account shall be maintained for the sole\nand exclusive benefit of the students.\n 2. In making this determination, the commissioner shall consider the\nfollowing factors: the number of refunds not paid by the school in a\ntimely manner; the number of claims made to, or paid by, the tuition\nreimbursement account; a pattern of misconduct which substantially\naffects the financial interests of students or the state, potential\nliability to the tuition reimbursement account, current assets as\nopposed to current liabilities, and such other measures as may be\nappropriate.\n