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| Department overview | |
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| Formed | October 3, 2011 |
| Jurisdiction | New York |
| Headquarters | New York, N.Y. |
| Department executive |
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| Website | www |
The New York State Department of Financial Services (DFS or NYSDFS) is the department of the New York state government responsible for regulating financial services and products, including those subject to the New York insurance, banking and financial services laws. [1] [2]
As part of the 2011 state budget, Governor Andrew M. Cuomo and the New York State Legislature consolidated the New York State Insurance Department and New York State Banking Department and created the New York State Department of Financial Services effective October 3, 2011. [2] The purpose of consolidating the agencies and creating the Department of Financial Services was to modernize regulation by allowing the agency to oversee a broader array of financial products and services [2] , such as service contract providers. [3]
The department supervises approximately 4400 entities, with assets of about $6.2 trillion. [4] These entities include: state-chartered banks and trust companies; insurance companies; insurance producers; insurance adjusters; bail bond agents; service contracts; [5] [6] [7] life settlements; budget planners; charitable foundations; check cashers; credit unions; investment companies; licensed lenders; money transmitters; mortgage bankers; mortgage brokers; mortgage loan servicers; premium finance agencies; private bankers; safe deposit companies; sales finance companies; savings banks; and savings and loans. [8]
The New York State Legislature unanimously confirmed Benjamin M. Lawsky on May 24, 2011, as New York State's first Superintendent of Financial Services. [9] From May 24, 2011, until October 3, 2011, Lawsky also was appointed, and served as, Acting Superintendent of Banks for the former New York State Banking Department. [9] As Superintendent of Banks, Lawsky led Governor Andrew M. Cuomo’s initiative to consolidate the New York State Banking Department and New York State Insurance Department towards a new financial regulator called the Department of Financial Services. [9]
James J. Wrynn, former Superintendent of Insurance, was appointed as Deputy Superintendent of Financial Services for the Department. [9] He left the Department in March 2012 to become a partner at Goldberg Segalla LLP. [10]
In August 2021, Governor Kathy Hochul appointed Adrienne A. Harris to lead the Department. The New York State Legislature confirmed Harris on January 25, 2022. [11] Prior to joining DFS, Superintendent Harris served as Senior Advisor to Deputy Treasury Secretary, Sarah Bloom Raskin. She then moved to the White House where she managed the financial services portfolio at the National Economic Council for President Obama. After leaving the White House, Superintendent Harris served as General Counsel and Chief Business Officer at Doma and also served as a Professor and Faculty Co-Director at the University of Michigan’s Gerald R. Ford School of Public Policy’s Center on Finance, Law and Policy. [12]
The Department has five divisions: the insurance division; banking division, consumer protection and financial enforcement division ("CPFED"), research & innovation division, cybersecurity division, and climate division. The insurance division has life, health, and property bureaus. The CPFED was created by the Financial Services Law and aims to protect and educate consumers of financial products and services. [9] It also aims to fight financial fraud. [9] The CPFED pursues civil and criminal investigations of activities that may constitute violations of the Financial Services Law, Banking Law, Insurance Law, or other laws, and brings enforcement proceedings where appropriate. [9]
The department also has an Office of General Counsel, which is the legal arm of the department. [13] It drafts legislation, regulations, and circular letters, issues legal opinions, and renders legal advice to Department staff. [13]
The department's main office is in New York City at One State Street. The department also has offices at One Commerce Plaza in Albany, 333 East Washington Street in Syracuse, 65 Court Street in Buffalo, and 163B Mineola Boulevard in Mineola. [13]
The department's regulations are compiled in titles 3, 11, and 23 of the New York Codes, Rules and Regulations (NYCRR).
In August 2013, Forbes magazine reported that the department initiated an investigation into bitcoin by issuing subpoenas to several companies and investors. [14]
On July 17, 2014, the department released details on a proposed BitLicense, which places regulations on any company or person that uses cryptocurrencies residing in New York. [15] The proposed regulations were officially published in the New York State Register on July 23, beginning a 45-day comment period. [15] [16] On February 25, 2015, a revised proposal notice was published, beginning another 30-day comment period. [17]
On 19 August 2014, Standard Chartered was fined $300 million by the department for breach of money-laundering compliance related to potentially high-risk transactions involving the bank's clients in Hong Kong and the UAE. The bank issued a statement accepting responsibility and regretting the deficiencies. [18]
On January 30, 2017, the NYSDFS (New York State Department of Financial Services) fined Deutsche Bank $425 million for violating New York's anti-money laundering laws. [19]
The DFS has the authority to license and regulate service contract providers. [20] A list of the currently licensed service contractor providers can be found at Currently Registered Service Contract Providers. New York State and other states, such as California, [5] have the authority to fine or prosecute unlicensed service contract providers. [21]
The Gramm–Leach–Bliley Act (GLBA), also known as the Financial Services Modernization Act of 1999, is an act of the 106th United States Congress (1999–2001). It repealed part of the Glass–Steagall Act of 1933, removing barriers in the market among banking companies, securities companies, and insurance companies that prohibited any one institution from acting as any combination of an investment bank, a commercial bank, and an insurance company. With the passage of the Gramm–Leach–Bliley Act, commercial banks, investment banks, securities firms, and insurance companies were allowed to consolidate. Furthermore, it failed to give to the SEC or any other financial regulatory agency the authority to regulate large investment bank holding companies. The legislation was signed into law by President Bill Clinton.
In the United States, banking had begun by the 1780s, along with the country's founding. It has developed into a highly influential and complex system of banking and financial services. Anchored by New York City and Wall Street, it is centered on various financial services, such as private banking, asset management, and deposit security.
Citigroup Inc. or Citi is an American multinational investment bank and financial services company in New York City. The company was formed by the merger of Citicorp, the bank holding company for Citibank, and Travelers in 1998; Travelers was spun off from the company in 2002.
Standard Chartered PLC is a British multinational bank with operations in consumer, corporate and institutional banking, and treasury services. Despite being headquartered in the United Kingdom, it does not conduct retail banking in the UK, and around 90% of its profits come from Asia, Africa, and the Middle East.
The Office of the Comptroller of the Currency (OCC) is an independent bureau within the United States Department of the Treasury that was established by the National Currency Act of 1863 and serves to charter, regulate, and supervise all national banks and thrift institutions and the federally licensed branches and agencies of foreign banks in the United States. The acting Comptroller of the Currency is Michael J. Hsu, who took office on May 10, 2021.
A custodian bank, or simply custodian, is a specialized financial institution responsible for providing securities services. It provides post-trade services and solutions for asset owners, asset managers, banks and broker-dealers. It is not engaged in "traditional" commercial or consumer/retail banking like lending.
The Office of the Superintendent of Financial Institutions is an independent agency of the Government of Canada reporting to the Minister of Finance created "to contribute to public confidence in the Canadian financial system". It is the sole regulator of banks, and the primary regulator of insurance companies, trust companies, loan companies and pension plans in Canada.
A branch, banking center or financial center is a retail location where a bank, credit union, or other financial institution offers a wide array of face-to-face and automated services to its customers.
The Central Bank of the United Arab Emirates is the state institution responsible for managing the currency, monetary policy, banking and insurance regulation in the United Arab Emirates.
QBE Insurance Group Limited is an Australian multinational general insurance and reinsurance company headquartered in Sydney, Australia. QBE offers commercial, personal and specialty products and risk management products. The company employs around 13,500 people in 27 countries.
The California Department of Insurance (CDI), established in 1868, is the agency charged with overseeing insurance regulations, enforcing statutes mandating consumer protections, educating consumers, and fostering the stability of insurance markets in California. The CDI has authority over how the insurance industry conducts business within California, and licenses and regulates the rates and practices of insurance companies, agents, and brokers in the state.
The New York State Insurance Department (NYSID) was the state agency responsible for supervising and regulating all insurance business in New York State. It was regarded in the industry as one of the most state-of-the-art insurance regulatory agencies.
The Illinois Department of Financial and Professional Regulation (IDFPR) is the Illinois state government code department that through its operational components, the Division of Banking, Division of Financial Institutions, Division of Professional Regulation, and Division of Real Estate, oversees the regulation and licensure of banks and financial institutions, real estate businesses and professionals, and various licensed professions, and is charged with enforcing standards of professional practice and protecting the rights of Illinois residents in their transactions with regulated industries.
Collateral Protection Insurance, or CPI, insures property held as collateral for loans made by lending institutions. CPI, also known as force-placed insurance and lender placed insurance, may be classified as single-interest insurance if it protects the interest of the lender, a single party, or as dual-interest insurance coverage if it protects the interest of both the lender and the borrower.
The New York State Banking Department was created by the New York Legislature on April 15, 1851, with a chief officer to be known as the Superintendent. The New York State Banking Department was the oldest bank regulatory agency in the United States.
The New Jersey Department of Banking and Insurance (DOBI) is one of 15 principal departments in New Jersey government. The department's mission is to regulate the banking, insurance and real estate industries in a professional and timely manner that protects and educates consumers and promotes the growth, financial stability and efficiency of these industries. The Commissioner of DOBI is Marlene Caride.
A systemically important financial institution (SIFI) is a bank, insurance company, or other financial institution whose failure might trigger a financial crisis. They are colloquially referred to as "too big to fail".
Benjamin Meier Lawsky is an American attorney and New York State's first Superintendent of Financial Services serving through June, 2015, and former Acting Superintendent of Banks serving through 2011.
The Glass–Steagall legislation was enacted by the United States Congress in 1933 as part of the 1933 Banking Act, amended as part of the 1935 Banking Act, and most of it was repealed in 1999 by the Gramm–Leach–Bliley Act (GLBA). Its protections and restrictions had also been chipped away during most of its existence by lenient regulatory interpretations and use of loopholes. After Glass–Steagall's 1999 repeal, there was a great deal of discussion in the banking and securities industries, and among policymakers and economists, about the practical positive and negative changes to the business and consumer environment. Later, as financial crises and other issues played out in the United States and even worldwide, arguments have broken out about whether Glass–Steagall, as originally intended, would have prevented these issues.
A BitLicense is the common term used for a business license for virtual currency activities, issued by the New York State Department of Financial Services (NYSDFS) under regulations designed for companies. The regulations are limited to activities involving the state of New York or a New York resident. People residing in, located in, having a place of business in, or conducting business in the State of New York count as New York Residents under these regulations. The license was introduced and designed by Benjamin Lawsky, New York's first Superintendent of Financial Services, in July 2014. Chartered entities do not require an explicit BitLicense, but may instead proceed with virtual currency activities via limited purpose trust charters approved by the NYDFS.
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