Statement from New York Groups on Nomination of Linda Lacewell to Lead NYS Department of Financial Services

STATEMENT FROM NEW YORK GROUPS ON NOMINATION OF LINDA LACEWELL TO LEAD NYS DEPARTMENT OF FINANCIAL SERVICES

New York groups today released the following statement regarding the nomination of Linda Lacewell as the next Superintendent of the NYS Department of Financial Services (DFS):

“The next DFS Superintendent must commit to taking bold action against financial companies that systematically exploit New Yorkers and extract wealth from New York communities. As the state’s chief regulator of the banking, insurance, check cashing, bail bond, and other financial industries, DFS has an obligation to advance racial, gender and economic justice. Given the Trump administration’s gutting of the federal Consumer Financial Protection Bureau and its ongoing attacks on immigrants, people of color and women, the need for a bold and resolute state financial regulator has never been clearer.

“The undersigned community, labor, criminal justice reform, cooperative and legal services organizations and community-based financial institutions call on the next DFS Superintendent to:

• Take aggressive action against banking and insurance companies, including Wall Street banks, insurers, lenders and other financial services companies that engage in and/or finance deceptive, discriminatory or predatory practices.
• Maintain New York’s forceful stance against predatory online lenders, including financial technology (“fintech”) companies. We applaud outgoing Superintendent Maria Vullo for taking a strong, vocal stance against financial technology companies that seek to circumvent New York’s consumer protection laws through sham “partnerships” with national banks. Many of these companies also engage in risky securitization of loans, rely on broad and invasive data collection, employ racially-biased loan underwriting algorithms, and have been the subject of state and federal enforcement actions.
• Continue DFS’s policy of aggressively enforcing New York’s strong usury laws. Since its inception in 2011, DFS has engaged in critical enforcement efforts to keep payday and other predatory lending out of our state, helping to preserve an estimated $790 million annually in low-income neighborhoods and neighborhoods of color throughout New York – an estimate that does not even include bank overdraft fees triggered by payday loans, funds drained by abusive debt collectors and other financial fallout.
• Crack down on predatory commercial bail bonds through regular, intensive examination, robust enforcement actions, and public education and outreach to uncover abuses.
• Prioritize and strengthen New York’s network of community development financial institutions, which includes nonprofit, mission-driven credit unions and loan funds that serve historically-redlined neighborhoods. A key first step for DFS is to establish a streamlined process for chartering community development credit unions that serve low-income neighborhoods throughout the state.”

ENDORSERS:

Bail Bonds Accountability Coalition

Brooklyn Coop Federal Credit Union

Center for NYC Neighborhoods

Chhaya CDC

Community Development Project

Community Loan Fund of the Capital Region, Inc.

District Council 37, AFSCME

Feerick Center for Social Justice

The Financial Clinic

Genesee Co-op FCU

Inclusiv (f/k/a National Federation of Community Development Credit Unions)

Lower East Side People’s FCU

The Legal Aid Society

Legal Services Staff Association, NOLSW/UAW 2320

Mobilization for Justice

New Economy Project

New York State CDFI Coalition

NYC NOWC (NYC Network of Worker Cooperatives)

VOCAL-NY

Western New York Law Center