Governor David Paterson has signed a bill into law that bans lawmakers from using state resources for personal business.
The new law makes it a felony when the fraud is ongoing with a value of at least $1,000.
One sponsor of the bill says the law will clarify the rules on mixing outside business and public work.
Last week, state lawmakers failed to override the governor's veto of another ethics bill he said was too weak.
That bill would have required lawmakers and lobbyists to disclose more of their outside business interests and income.