Recent developments about the New York State Department of Financial Services
(Not affiliated with NYDFS; just a blog.)
NYDFS Superintendent Adrienne A. Harris testified today before the New York State Senate standing committee on Banks concerning DFS supervision and other issues. The testimony may be found here.
According to Bloomberg: “New York’s top financial industry regulator is trying to expand bank examiner staffing, but relatively low pay and federal agencies’ competition for skilled labor are posing stiff challenges. The New York Department of Financial Services has faced ‘internal staffing restraints’ that hinder adequate staffing of examination teams, the DFS said in an … Read more
Superintendent Harris announced today final adoption of the assessment regulation. Quick takeaways: • The adopted regulation effectuates legislation in the NYS FY23 Budget giving DFS authority to collect supervisory costs from licensed virtual currency businesses, similar to other licensees regulated by DFS. • Says DFS: “As stewards of others’ assets, virtual currency entities play an important role in the … Read more
While the jury appears still to be out on what will result in imposition of a new DOJ monitorship under the Monaco Memos, if you breach a DPA — twice — you will get an extension of the Monitorship. DOJ has now extended the Ericsson monitorship arising out of an FCPA prosecution for one year. … Read more
State bank supervisors have appointed New York State Department of Financial Services Superintendent Adrienne A. Harris to serve as the state banking representative on the Financial Stability Oversight Council (FSOC), according to the Conference of State Banking Supervisors. “Superintendent Harris’ background and experience at both the federal and state level will be an asset for … Read more
According to its second report on fair lending violations, NYDFS took action against two mortgage lenders, although it did not make any findings of violations: “After taking the testimony of Premium Mortgage and 1st Priority executives, as well as a number of licensed mortgage loan originators at Premium Mortgage, and reviewing documents provided by the … Read more
According to Superintendent Harris, NYDFS will issue additional guidance for cryptocurrency firms. Superintendent Harris via Law360: “We’ll have more to say on capitalization,….You’ll hear more from us on consumer protection, disclosures, advertising … [and] complaints, making sure these companies have an easy way for consumers to complain. . . . Harris indicated that the forthcoming … Read more
CHIEF FEDERAL BANKING REGULATOR MICHAEL HSU, THE ACTING COMPTROLLER OF THE CURRENCY, IS “CAREFUL AND CAUTIOUS” ON CRYPTO — Michael Hsu: “Last year, the OCC adopted a “careful and cautious” approach to crypto activities by national banks. This helped mitigate the risk of contagion from crypto to the banking system. Years of reform and rebuilding … Read more
Superintendent Adrienne A. Harris, Peter Marton & Kaitlin Asrow spoke today at The Brookings Institution about FTX, indicating NY residents had limited exposure to the collapse because (a) FTX had not yet been licensed to operate in NY (it had a pending application) and (b) FTX’s own coin, FTT, had not yet been greenlisted by DFS. Video of the interviews is here: https://www.brookings.edu/events/digital-asset-regulation-the-state-perspective/?utm_campaign=events%3a%20economic%20studies&utm_medium=email&utm_content=231476264&utm_source=hs_automation
Are Twitter Users Really the Best Regulator for Crypto? Regarding Crypto.com‘s erroneous transfer of $400 million, the Wall Street Journal Reports: “The transfer of a large chunk of ether, a popular cryptocurrency, took place on Oct. 21, but came to light after Twitter users flagged the transfer as unusual, based on publicly available blockchain transaction … Read more