All’s Quiet On The New York Front

January 9, 2014 at 8:23 am Leave a comment

Governor Cuomo’s fourth State of the State address yesterday was overshadowed by news that high ranking members of Governor Christie’s staff exacted political revenge on Fort Lee’s mayor, who had the audacity not to endorse the Governor’s re-election bid, by creating traffic on the George Washington Bridge.

Personally, I don’t know what Republicans viewing the New Jersey Governor as a potential Presidential nominee should find more disturbing: the fact that his staff has such callous disregard for New Jersey commuters or the fact that they are so politically incompetent that a traffic jam on the GW can be directly attributable to their actions. It’s kind of like highlighting a needle in a haystack and then denying its existence.

Still, the Governor’s speech is important for credit unions for what it tells them about the state of New York’s regulatory environment. Most importantly, there is not a single mention in the Governor’s State of the State or his accompanying 200 page booklet of initiatives for this year’s legislative session referring to the word foreclosure, bank, or financial crisis. This demonstrates that, like the federal government, regulators and elected officials have put all the regulatory and legal structures in place that they feel they need to in response to the Great Recession and mortgage meltdown and are now ready to carry on with the new normal.

Don’t underestimate the significance of this shift in tone. When the Governor took office, his first State of the State criticized lax financial enforcement and advocated for the merger of the State Banking and Insurance Departments. He even put one of his most trusted aides, Benjamin Lawsky, in charge of the project. Fast forward to yesterday, and what we have is a Department of Financial Services that more aggressively pursues financial malfeasance than the old Banking Department ever did and that is more willing to regulate on issues such as mortgage modifications and debt collection practices than was the case a mere seven years ago. And, of course, much of what the nation as a whole is going to start grappling with tomorrow when it comes to what constitutes a good faith effort to keep someone in their home has already been grappled with by New York State credit unions for several years now.

All this means, bottom line, is that if you missed the State of the State, there was nothing tucked away that could potentially impact your credit union’s operations but as you rush to make sure that you are complying with the latest federal mandates, your credit union would be well advised to keep an eye on what the Department of Financial Services is doing, as well.

Entry filed under: New York State, Political, Regulatory. Tags: , , .

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Authored By:

Henry Meier, Esq., General Counsel, New York Credit Union Association.

The views Henry expresses are Henry’s alone and do not necessarily reflect the views of the Association.

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