Yes, it is correct that according to New York State laws that if you allow an unlicensed, or person without a valid license, to operate your vehicle you can be cited by law enforcement.

NY Vehicle and Traffic Code section 509 discusses drivers without valid licenses being on the roadway. Subsection 1 states that except while operating a motor vehicle during the course of a road test conducted pursuant to the provisions of this article, no person shall operate or drive a motor vehicle upon a public highway of this state or upon any sidewalk or to or from any lot adjacent to a public garage, supermarket, shopping center or car washing establishment or to or from or into a public garage or car washing establishment unless he is duly licensed pursuant to the provisions of this chapter.

Subsection 4 would appear the part of law that would relate to your situation with your step-son which says no person shall knowingly authorize or permit a motor vehicle owned by him or in his charge to be operated in violation of the licensing laws.

A violation of any provision of this section of NYS law shall be punishable by a fine of not less than seventy-five nor more than three hundred dollars, or by imprisonment for not more than fifteen days, or by both such fine and imprisonment except, if the violation consists of failure to renew a license which was valid within sixty days, the fine shall be not more than forty dollars, and except that a violation of subdivision seven or eight of this section shall be punishable by a fine of not more than seventy-five dollars.

According to the NY DMV site driving while your license is suspended is referred to in NYS as an aggravated unlicensed operation or AUO. There are different degrees of AUO. Third degree is a misdemeanor punishable by a mandatory fine of $200 - $500, a surcharge and possible imprisonment up to 30 days or probation.

Second degree AUO is also a misdemeanor that is for repeat offenders and has stiffer penalties including higher fines and mandatory imprisonment or probation. First degree AUO is a felony with even bigger fines, more imprisonment or probation time and possible seizure and forfeiture of the vehicle driven.

Under section 511-A of the NYS VAT it notes that it is against the law to facilitate someone with a suspended license to drive so this portion of the law could also apply to you if you were to allow him to drive your vehicles while his license was suspended. Under subsection 1 it states:

A person is guilty of the offense of facilitating aggravated unlicensed operation of a motor vehicle in the third degree when such person consents to the operation upon a public highway of a motor vehicle registered in such person's name knowing or having reason to know that the operator of such vehicle is a person whose license or privilege of operating such motor vehicle in this state or privilege of obtaining a license issued to operate such motor vehicle by the commissioner is suspended, revoked or otherwise withdrawn by the commissioner and the vehicle is operated upon a public highway by such person.

Facilitating aggravated unlicensed operation of a motor vehicle in the third degree is a traffic infraction. When a person is convicted thereof the sentence of the court must be: (i) a fine of not less than two hundred dollars nor more than five hundred dollars or (ii) a term of imprisonment of not more than fifteen days, or (iii) both.

Now if the officer was stating that you could be held liable and fined if he drove someone else's car while your step-son's license under suspension it may be due to the fact he is a minor (if he is under 18) and thus if someone in your household signed a parental consent form for him to get a license they can be held liable. If this is the case then you should check with the NYS DMV to see about your liability.

You mentioned you are trying to take him off of your insurance policy now. If he will still have the car in his possession this may be dangerous to do since if he continued to drive and was in another accident you could be fined as we mentioned above plus held liable for damages he caused if there was no insurance on the vehicle to cover the accident. As owners of the car you, as well as the driver your stepson, can normally be held liable for his actions behind the wheel. Also while your name is on the registration of the vehicle you will want to make sure the car is insured so you are not penalized by the state of New York for a car being registered to you being uninsured.

Section 315 of the NYS Vehicle laws discusses financial responsibility. Here it states that when insurance with respect to any motor vehicle is terminated by cancellation or failure to renew, the owner shall surrender forthwith his registration certificate and number plates of the vehicle to the commissioner unless proof of financial security otherwise is maintained.

NYS law requires you to surrender your vehicle plates to the NYS DMV before there is a lapse or cancellation of the required liability auto insurance. If you do not surrender your vehicle plates, the DMV will suspend your registration and driver's license. So if you are taking your stepson's car off of your insurance be sure that he has placed insurance coverage on it. If you are only taking him off the policy and not his car make sure that he then does not operate the vehicle since with him either being excluded from the policy or taken off then coverages would not normally be extended to him if he drove the vehicle and was in an accident.

If you are unclear on what you may be held liable for and what you could be charged with if your step-son continues to drive on a suspended license contact a lawyer or the NYS DMV for more information and consumer advice.