Settlement Spotlights Upstart N.Y. Regulator
by Janet Babin
Banking industry officials say it’s unheard of: A state regulator, flying solo, threatens to take away the state license of a global bank — and then secures a very public settlement. That’s exactly what happened in New York this past week, when the state’s Department of Financial Services reached a settlement with Britain’s Standard Chartered Bank over allegations that it schemed with the Iranian government to launder billions of dollars. So who is the man who dared to leapfrog over federal regulators? He’s Benjamin Lawsky, the 42-year-old who was appointed less than a year ago to the newly formed state agency by Gov. Andrew Cuomo. Lawksy and the agency moved forward without federal regulators, who had also reportedly been reviewing similar allegations. Karen Shaw Petrou at Federal Financial Analytics says it’s a shock that foreign bankers are still absorbing. “Many of them had not taken the ability of New York state to be a meaningful or even a very aggressive regulator as seriously as they should have,” Petrou says. “They got one heck of a wake-up call.”
http://www.npr.org/2012/08/18/159066054/settlement-shines-light-on-n-y-regulator-agency