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.
History
As part of the 2011 state budget, Governor
Andrew M. Cuomo
Andrew Mark Cuomo ( ; ; born December 6, 1957) is an American lawyer and politician who served as the 56th governor of New York from 2011 to 2021. A member of the Democratic Party, he was elected to the same position that his father, Mario Cu ...
and the
New York State Legislature
The New York State Legislature consists of the two houses that act as the state legislature of the U.S. state of New York: The New York State Senate and the New York State Assembly. The Constitution of New York does not designate an official ...
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.
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.
Mission
The mission of the department, according to its website, is to: foster the growth of the financial industry in New York and spur state economic development through judicious regulation and vigilant supervision; ensure the continued solvency, safety, soundness and prudent conduct of the providers of financial products and services; ensure fair, timely and equitable fulfillment of the financial obligations of such providers; protect users of financial products and services from financially impaired or insolvent providers of such services; encourage high standards of honesty, transparency, fair business practices and public responsibility; eliminate financial fraud, other criminal abuse and unethical conduct in the industry; and educate and protect users of financial products and services and ensure that users are provided with timely and understandable information to make responsible decisions about financial products and services.
Supervision
The department supervises approximately 4400 entities, with assets of about $6.2 trillion.
These entities include: state-chartered
bank
A bank is a financial institution that accepts deposits from the public and creates a demand deposit while simultaneously making loans. Lending activities can be directly performed by the bank or indirectly through capital markets.
Because ...
s and trust companies; insurance companies; insurance producers; insurance adjusters; bail bond agents; service contracts;
life settlements
A life settlement is the legal sale of an existing life insurance policy (typically of seniors) for more than its cash surrender value, but less than its net death benefit, to a third party investor. The investor assumes the financial responsibi ...
; budget planners; charitable foundations; check cashers;
credit unions
A credit union, a type of financial institution similar to a commercial bank, is a member-owned nonprofit financial cooperative. Credit unions generally provide services to members similar to retail banks, including deposit accounts, provision ...
; 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.
Leadership
The
New York State Legislature
The New York State Legislature consists of the two houses that act as the state legislature of the U.S. state of New York: The New York State Senate and the New York State Assembly. The Constitution of New York does not designate an official ...
unanimously confirmed
Benjamin M. Lawsky on May 24, 2011, as New York State's first Superintendent of Financial Services.
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.
As Superintendent of Banks, Lawsky led Governor
Andrew M. Cuomo
Andrew Mark Cuomo ( ; ; born December 6, 1957) is an American lawyer and politician who served as the 56th governor of New York from 2011 to 2021. A member of the Democratic Party, he was elected to the same position that his father, Mario Cu ...
’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.
James J. Wrynn, former Superintendent of Insurance, was appointed as Deputy Superintendent of Financial Services for the Department.
He left the Department in March 2012 to become a partner at Goldberg Segalla LLP.
Organization
The Department has five divisions: the insurance division; banking division, financial frauds and
consumer protection
Consumer protection is the practice of safeguarding buyers of goods and services, and the public, against unfair practices in the marketplace. Consumer protection measures are often established by law. Such laws are intended to prevent business ...
division ("FFCPD"), capital markets division, and real estate division. The insurance division has life, health, and property bureaus. The FFCPD was created by the Financial Services Law and aims to protect and educate consumers of financial products and services.
It also aims to fight financial fraud.
The FFCPD 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.
The department also has an Office of General Counsel, which is the legal arm of the department.
It drafts legislation, regulations, and circular letters, issues legal opinions, and renders legal advice to Department staff.
The current General Counsel is
Richard Weber since May 1, 2020.
Offices and locations
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.
Activities
The department's regulations are compiled in titles 3, 11, and 23 of the ''
New York Codes, Rules and Regulations'' (NYCRR).
Bitcoin
In August 2013, ''Forbes'' magazine reported that the department initiated an investigation into
bitcoin
Bitcoin ( abbreviation: BTC; sign: ₿) is a decentralized digital currency that can be transferred on the peer-to-peer bitcoin network. Bitcoin transactions are verified by network nodes through cryptography and recorded in a public distr ...
by issuing subpoenas to several companies and investors.
On July 17, 2014, the department released details on a proposed
BitLicense, which places regulations on any company or person that uses
cryptocurrencies
A cryptocurrency, crypto-currency, or crypto is a digital currency designed to work as a medium of exchange through a computer network that is not reliant on any central authority, such as a government or bank
A bank is a financial i ...
residing in New York.
The proposed regulations were officially published in the ''
New York State Register
The ''New York State Register'' is the official journal of the New York state government that contains information on proposed regulations and rulemaking activities. The ''New York State Register'' is published weekly by the New York State Depar ...
'' on July 23, beginning a 45-day comment period.
[ On February 25, 2015, a revised proposal notice was published, beginning another 30-day comment period.
]
Standard Chartered fined
On 19 August 2014, Standard Chartered
Standard Chartered plc is a 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 9 ...
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
Hong Kong ( (US) or (UK); , ), officially the Hong Kong Special Administrative Region of the People's Republic of China ( abbr. Hong Kong SAR or HKSAR), is a city and special administrative region of China on the eastern Pearl River Delt ...
and the UAE
The United Arab Emirates (UAE; ar, اَلْإِمَارَات الْعَرَبِيَة الْمُتَحِدَة ), or simply the Emirates ( ar, الِْإمَارَات ), is a country in Western Asia (The Middle East). It is located at th ...
. The bank issued a statement accepting responsibility and regretting the deficiencies.
Service Contract providers
The DFS has the authority to license and regulate service contract providers. 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, have the authority to fine or prosecute unlicensed service contract providers.
References
contractorExternal links
*
Banking
Insurance
an
Financial Services
in the New York Codes, Rules and Regulations
{{authority control
Financial Services
Financial services are the Service (economics), economic services provided by the finance industry, which encompasses a broad range of businesses that manage money, including credit unions, banks, credit-card companies, insurance companies, acco ...
2011 establishments in New York (state)
Bank regulation in the United States by state
Government agencies established in 2011
Insurance in the United States