Recent developments about the New York State Department of Financial Services
(Not affiliated with NYDFS; just a blog.)
Enforcement Takeaways: – This conduct was dated, covering 2015 – 2109; – The jurisdictional hook was modest, with only $2.5 million of funds flowing through SEB’s New York Branch in that time period; – Many of the deficiencies were identified by Internal Audit – demonstrating both its importance to strong compliance, as well as the … Read more
– Regulatory Takeaway: NYDFS appears still quite early in development of its supervisory oversight of AI frontier models required by the RAISE Act, at a time that frontier models appear to be running ahead of, or away from, their developers. – In a podcast interview with CBS6 Albany, Superintendent Asrow describes implementation of the RAISE … Read more
NYDFS PENALIZES SMALLER, EXEMPT MONEY TRANSMITTER $250,000 FOR CYBERSECURITY LAPSES · Enforcement Takeaway: Even smaller entities partially-exempt from the Cybersecurity Regulation (Part 500) may be subject to enforcement. According to the NYDFS Consent Order: · Order Express, Inc. is a regional money services business licensed by NYDFS to engage in money transmission in New York, with a focus … Read more
Per the DFS Press Release: · Following “the 2016 Panama Papers leak of millions of Mossack Fonseca law firm records . . . [t]he Department subsequently launched reviews of licensees connected to the law firm, including Swedbank.” · “Over the course of two years, DFS issued two information requests to Swedbank, seeking details about the Bank’s relationships … Read more
According to the NYDFS Consent Order and release: · Santander permits consumers to request an extension of time to make payments on automobile loans. · Santander told consumers they could obtain the extension for a single $25 extension fee, when in practice Santander charged borrowers an extension fee of $25.00 per month. · Notable here is timing. Santander voluntarily … Read more
According to the DFS Consent Order: · Following identification of a zero-day vulnerability in a file transfer application called MOVEit, it was determined that Delta Dental’s default retention settings for certain files were longer than necessary, or even that, in some instances, Delta had disabled certain folders’ retention settings entirely, thus allowing for exfiltration of PII … Read more
According to a New York State Department of Financial Services press release under Acting Superintendent Kaitlin Asrow: · House of Prayer and Life, Inc. d/b/a Jericho Share or Jericho Health Share purported to act as a federally-authorized Health Care Sharing Ministry. · Instead of properly qualifying under that federal law, DFS found Jericho had operated as an … Read more
Reports Forbes: “OCC trust bank charters for Circle, Ripple, Paxos, BitGo and Fidelity Digital Assets are one of the clearest signals yet that crypto is moving from the regulatory perimeter into the core of the U.S. banking system. For banks, it is arguably the biggest institutional crypto signal of 2025—just as spot bitcoin ETFs were … Read more
In a fireside chat with Penny Lee, President and CEO, Financial Technology Association, Acting Superintendent Kaitlin Asrow discussed: · Crypto: given the changing regulatory environment at the federal level, Superintendent Asrow believes some DFS charters will flip to federal; some entities will want to hold both federal and state charters; and some entities will hold onto DFS … Read more
Superintendent Harris has been busy on her way out the door: – In addition to issuing several pieces of guidance in the past few weeks, she announced Consent Orders with 8 insurance firms and brokers resolving an investigation involving attacks on agent and consumer portals that allegedly exposed consumer information. According to the DFS press … Read more