Happy Trails Ben Lawsky

May 21, 2015 at 9:04 am Leave a comment

“Bank Cop Lawsky Turns In His Badge ”

That’s the headline into today’s WSJ announcing the Departure of  Ben Lawsky  as the first head of the Department of New York’s department of  Financial Services.   As its first  Superintendent  he oversaw the unification of the Insurance and Banking Departments in   the opening  act of what has been  a very impressive tenure.

In his first State Of The State address  Governor Cuomo  criticized the state’s performance  cracking down on   banker malfeasance in  the years leading up to the Mortgage Meltdown.  He wanted a Superintendent  more analogous to an Attorney General than a traditional regulator. The WSJ  headline speaks volumes about how successfully  Lawsky  carried out this task for the Governor, for  whom he had served as an a top assistant  when the Governor was Attorney General.  Lawsky brought the zeal of a former federal prosecutor  to the job and demonstrated that the state has enough jurisdiction to make itself a major player in investigations  previously thought of as the exclusive purview of the federal government,  such as BSA violations by foreign banks with New York branches.

If you think I’m exaggerating here is a trivia question for you: Who was New York’s last Banking Superintendent? Richard Neiman.  No one ever thought of him as a Hell-Hound of Wall Street.

On the more traditional regulatory front, his initiative that   I believe will have the most lasting impact-hopefully for the better but  maybe for the worse will be in the regulation of virtual currency.  New York was the first state to establish a licensing requirement for virtual currency traders.  The issue he grappled with: how to increase regulatory oversight without stifling currency innovation-will be one of the key challenges faced by his successors for years to come.

Finally and most importantly, his  tenure has also been marked by a refreshing  receptiveness to credit union issues.  The Department is increasing staff dedicated to credit unions and has expressed a willingness  to work with credit unions that may be interested  in converting to the state charter.  Plus,  its acquiescence  was crucial to ultimately getting our enhanced field of membership  bill approved by the governor.

In my ever so humble opinion this is a pretty good list of accomplishments,  He is starting his own consulting firm but my guess is that New York hasn’t seen Lawsky’s last stint on the public stage.  Pure speculation on my part but he will run for statewide office someday.

Entry filed under: New York State. 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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