New York's top bank regulator wants to lead the federal government in aggressively cracking down on errant corporations.
Last week the New York Department of Financial Services fined the German Commerzbank $1.4 billion last week, while also requiring the company fire several employees.
"We think New York state can become a real laboratory of democracy when it comes to financial regulation," Ben Lawsky, Superintendent of Financial Services, said last week before University of Albany business students.
Four additional banks have agreed to block online payday lenders from accessing customer accounts in New York. The agreement comes as the banks' processing network remains silent on efforts to keep the illegal loans from crossing state borders.
Payday lending is generally illegal in New York and Connecticut because the loans, which can be as high as 500 percent, exceed both states' cap on allowable interest.
However, investigators in New York have received complaints that payday lenders are making these loans online.
Bank regulators in New York are accusing the nation's largest subprime mortgage lender of errors that might have harmed hundreds of thousands of borrowers.
New York's Department of Financial Services accuses Ocwen Financial of backdating letters warning of foreclosure or unsuccessful loan modifications. This means that by the time a borrower receives a letter from Ocwen, it's already too late to do anything about it.
New York’s top banking regulator says he plans to relax pending rules set to govern Bitcoin and other virtual currencies. The more startup-friendly requirements come after criticism that the state has moved too quickly to regulate the new technology.
Futurists see virtual currencies as revolutionizing the financial industry the same way the Internet has revolutionized nearly everything.
New York was the first jurisdiction to introduce rules on Bitcoin. Regulators hope to mark the path for other jurisdictions to follow.