In the wake of the Wells Fargo scandal, New York’s governor is proposing a new law that would allow the state to ban people from the financial services industry for bad behavior
New York’s governor wants the state to be able to ban people from working in the financial services sector for “egregious conduct.”
New York Gov. Andrew Cuomo has announced a legislative proposal to allow the state’s Department of Financial Services to ban what he calls “bad actors” from the industry for “egregious and deceptive behavior,” HousingWire reported.
Cuomo cited Wells Fargo’s recent fake-account scandal as the kind of thing that might get a person banned from the industry under the proposed rule.
“New York is the financial center of the world and we have zero tolerance for those who seek to defraud customers and undermine the system,” Cuomo said. “The excesses and systematic abuse at the center of the Wells Fargo scandal is unacceptable and New York, in its role as a regulator, is seeking to take bold steps to crack down on this unacceptable behavior.”
Cuomo’s proposal would require adding a section to New York’s Financial Services Law that would disqualify people from the banking or insurance industries if, following a hearing, the superintendent of the DFS finds they’ve done something “so severe as to have a direct bearing on their fitness or ability to continue participating in the industry.”
““DFS has responded to new technologies to protect consumers and encourage innovation through existing laws,” said DFS Superintendent Maria Vullo. “This proposal will provide DFS with additional tools to allow responsible state regulation of Fintech companies while combatting predatory practices by bad actors including payday lenders.”
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