NYDFS ARGUES IT FACES PAY GAP CHALLENGES IN RECRUITING

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

NYDFS ADOPTS REGULATION ON CRYPTO FIRM ASSESSMENTS

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

DOJ & SEC EXTEND ERICSSON MONITORSHIP

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

BACK TO THE WORLD OF BANKING: NYDFS SUPERINTENDENT ADRIENNE A. HARRIS APPOINTED TO FSOC

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

NYDFS TAKES ADDITIONAL ENFORCEMENT ACTION AGAINST REDLINING

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

NYDFS TO ISSUE ADDITIONAL GUIDANCE ON CRYPTOCURRENCY

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

OCC ACTING COMPTROLLER “CAREFUL AND CAUTIOUS” ON CRYPTO

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

THE FTX COLLAPSE: NYDFS PROVIDES ITS PERSPECTIVE

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?

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

NYDFS PROPOSES AMENDMENTS TO CYBERSECURITY REGULATION

NYDFS Proposed amendments to its Cybersecurity Regulation, “Part 500.”  According to DFS, the amendments include: – Creation of three tiers of companies, further tailoring the regulation to a diverse set of businesses with different defensive needs. – Enhanced governance requirements, thereby increasing accountability for cybersecurity at the Board and C-Suite levels. – Additional controls to … Read more