Recent developments about the New York State Department of Financial Services
(Not affiliated with NYDFS; just a blog.)
• According to NYDFS, this is the second annual report, reviewing lending activity based on the New York Home Mortgage Disclosure Act (“HMDA”) data from 2023. • As in last year’s report, NYDFS analyzed mortgage lending in 23 different geographies, including New York State as a whole, all metropolitan statistical areas (“MSAs”) within the state, and a … Read more
Speaking this week at DACOM 2024, Superintendent Harris stated: • The Superintendent does not contemplate any amendments to the BitLicense, even though the regulatory regime will be in effect for 10 years coming June. • She said the BitLicense framework will continue to evolve instead through guidance, enforcement and other supervisory activity. She pointed to the agency’s … Read more
• According to the agency, “DFS has finalized the guidance with careful consideration of the valuable feedback received from regulated entities and other key stakeholders, including trade associations, advisory firms, universities, and the broader public.” • Superintendent Adrienne Harris has said recently, in several public settings (including the IIB Conference in March), that guidance for banks is … Read more
NYDFS has issued guidance concerning how Virtual Currency Entities handle customer complaints. According to the guidance: • The guidance applies to all “Virtual Currency Entities” (“VCEs”) • The guidance applies to individual customers – not institutions • The guidance requires VCEs to collect relevant data so DFS can assess whether they are resolving customer service requests and complaints … Read more
NYDFS took action against another insurance firm. According to the DFS allegations: • The benefits of blanket accident and health insurance policies issued to groups including institutions of higher education, day camps and childcare providers were found not bear a reasonable relationship to the premiums paid by these insureds. • The minimum loss ratios maintained by National … Read more
Speaking at the Institute of International Bankers Annual Conference in DC, Superintendent Harris discussed the following: • CHARACTER AND FITNESS FOR BANKING EXECS: Superintendent Harris responded to “the buzz” about this recent DFS guidance, saying it should be unsurprising that regulated banks would want to screen out personnel in sensitive positions with criminal records, dire financial problems, … Read more
According to the DFS allegations (and other public information): • State-owned Industrial and Commercial Bank of China has $22 Billion in assets in the New York branch alone, and over $5 Trillion globally, and is the world’s largest bank by assets according to the WSJ and third largest by capitalization according to Forbes. • ICBC entered into … Read more
• DFS has issued draft guidance that “outlines DFS’s expectations for how insurers develop and manage the integration of external consumer data and information sources (‘ECDIS’), artificial intelligence systems (‘AIS’), and other predictive models to mitigate potential harm to consumers.” • According to DFS: “The use of external consumer data and information sources (‘ECDIS’) and artificial intelligence systems … Read more
Enforcement takeaways from the Consent Order (per DFS allegations): • After doing a lookback, Payoneer discovered it had engaged in approximately $793,000 worth of transactions with persons or entities in sanctioned countries during the period Iran, Sudan, Syria and individuals on the SDN List between 2013 and 2018 • Payoneer self-disclosed these violations to OFAC, which settled … Read more
According to the strategy released by New York governor Kathy Hochul: “Financial Sector[:] In 2017, the New York State Department of Financial Services (DFS) became the first banking or insurance regulator in the nation to establish a cybersecurity division to protect consumers and industries from cyber threats. DFS also created first-in-the-nation requirements for DFS-regulated banks, … Read more