Infighting between the New York State Department of Financial Services (NYDFS) and the state governor’s office has reportedly led to the resignation of key figures.
The Wall Street Journal reported Monday that Anthony Albanese, acting superintendent of the NYDFS and successor to BitLicense architect Benjamin M Lawsky, is set to resign alongside agency spokesman Matthew Anderson. According to Bloomberg News, Albanese will depart in December.
Under Lawsky – who left office in June – the NYDFS developed the BitLicense, a licensure scheme for digital currency companies operating in the state of New York. As head of the NYDFS, Albanese has overseen the initial roll-out of the regulatory framework.
The driving force being the resignations, according to WSJ and Bloomberg sources, is alleged interference from the governor’s office into NYDFS activities.
The office of New York Governor Andrew Cuomo has reportedly tried to interfere with the NYDFS subpoena process by requiring that it be notified prior to subpoenas being issued – a charge the governor’s office has denied.
Contributing to the strain were reported conflicts over monetary penalties extracted by the NYDFS, which since its creation in 2011 has reaped billions of dollars in settlements from some of the city’s largest financial institutions. Some of those institutions, especially those headquartered overseas, are said to have complained about the fines to Cuomo’s office.
“Mr. Cuomo’s staff has sought in recent months to exert more control over the regulator, which has established itself as a powerful financial watchdog and brought billions of dollars in penalties to New York state’s general fund,” the Journal reported. “The regulator was also unpopular on Wall Street, where some executives felt the department at times overreached on Mr. Lawsky’s watch.”
Albanese said this week that the move out of NYDFS was always in the works, saying in a statement provided to Bloomberg:
“After four years at DFS, I decided it was time to return to the private sector and I have accepted another opportunity outside of government. This was always intended to be a temporary position to help smooth the transition process.”
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