Somewhere in New York there is an ex-drug addict who owes a debt of thanks to the NYDFS — but there are few banking executives who would offer similar warmth towards the regulatory institution.
Since 2011 the state’s Department of Financial Services has wrung about $6.8bn of fines out of some of the world’s biggest banks. Most of the proceeds have gone into patching up roads and bridges. But this year $5m made its way to a chemical dependence programme run by the Office of Alcoholism and Substance Abuse, according to public records.
For all its usefulness in plugging gaps in budgets, the DFS has become something of a headache for New York state governor, Andrew Cuomo. Since he mashed together the state banking and insurance regulators as a way to improve oversight after the global financial crisis, the DFS has earned a reputation as the snarling watchdog of Wall Street. But its methods have upset institutions at home — and caused real angst abroad.
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