A relatively new governmental department, the NYSDFS was created in 2011 by the Financial Services Law, which mandated a merger between the New York State Insurance Department and the New York State Banking Department – both of which date back to the 19th century.
Today, the NYSDFS is the primary regulator for a diverse range of financial institutions. Its supervision takes in around 4,400 separate entities including banks and trusts, insurance companies, lenders, mortgage brokers, charities, virtual currency businesses, and more. The NYSDFS has offices across the state but is headquartered in New York City. The NYSDFS is led by its Superintendent – currently Maria T. Vullo.
What Does the NYSDFS Do?
The NYSDFS seeks to provide both regulation and leadership to the institutions it supervises. Working with other law enforcement agencies and regulators, this role translates to investigating and prosecuting instances of financial crime – including fraud and money laundering, and other violations of the New York Codes, Rules and Regulations (NYCRR). In this capacity, the NYSDFS has a mandate to:
In its supervisory role, the NYSDFS has the authority to introduce regulations which reflect emerging trends in financial crime. With this in mind, the NYSDFS recently introduced its Cybersecurity Regulation (23 NYCRR 500), along with the BitLicense, which is required in the state of New York for the conduct of cryptocurrency related activities. Similarly, the 2017 regulation, Part 504, fortifies AML measures by introducing sanctions screening and transaction monitoring requirements for all New York financial institutions.
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