Subscribe to our InfoBytes Blog weekly newsletter and other publications for news affecting the financial services industry.
On March 30, the New York Department of Financial Services announced emergency regulations requiring New York State regulated issuers of life insurance and annuity contracts, property and casualty insurers and premium finance agencies to provide relief to consumers and businesses experiencing financial hardship due to the Covid-19 outbreak. Among other things, the emergency regulations: (i) extend grace periods for making life insurance payments for 90 days, and for making property and casualty insurance payments for 60 days; (ii) establishing a special enrollment period from April 1 to April 15 to obtain health insurance under the New York State’s Health Plan Marketplace; (iii) prohibit life insurers and property and casualty insurers from imposing late fees, reporting the policyholder to a credit bureau, or referring the policyholder to a debt collection agency with respect to such delayed payments; (iv) permit premiums due but not paid during the grace period to be repaid over 12 equal monthly installments; and (v) require premium finance companies to grant the same relief to consumers and businesses that have financed the payments of their premiums, subject to safety and soundness considerations.
New York governor issues executive order to continue temporary suspension and modification of laws relating to Covid-19
On March 27, the New York governor issued Executive Order 202.11 continuing the temporary suspension and modification of certain laws, including the expiration date of certain licensing laws, through April 26.
The NYDFS issued guidance encouraging regulated insurance persons to use and accept electronic signatures and records to facilitate insurance transactions in instances that cause no consumer harm. The NYDFS reminded licensees that both New York’s Electronic Signatures and Records Act and the federal Electronic Signatures in Global and National Commerce Act permit the use of electronic signatures and records if the consumer consents. The NYDFS also stated it does not require consumer consent be obtained in any particular way.
On March 24, NYDFS issued an emergency regulation providing financial relief to New Yorkers affected by Covid-19. Among other things, New York regulated institutions must (i) make applications for forbearance of any payment due on a residential mortgage of a property located in New York, widely available to any individual who resides in New York and who demonstrates financial hardship as a result of the Covid-19 pandemic; and (ii) subject to the safety and soundness requirements of the regulated institution, grant such forbearance for a period of 90 days to any such individual. New York regulated banking organizations must also provide certain financial relief to individuals who can demonstrate financial hardship, including eliminating fees charged for use of certain ATMs, overdraft fees, and credit card late payment fees. The regulations also establish requirements for institutions regarding the criteria for individuals to qualify for relief, application processing, and record retention, including expedited timelines to process applications for relief.
On March 22, the Chief Administrative Judge of the New York State Courts issued an administrative order directing that, effective immediately and until further order, no papers will be accepted for filing by a county clerk or court in any matter not considered an “essential matter.” Essential matters include certain criminal matters, family court matters, Supreme Court matters, civil/housing matters, and any other matters the court deems essential. The list of essential proceedings is subject to ongoing review and amendment, as necessary.
On March 21, the New York governor issued an executive order stating that it is an “unsafe and unsound business practice” for banks to fail to “grant a forbearance to any person or business who has a financial hardship as a result of the COVID-19 pandemic for a period of 90 days.” The Order directs the New York Department of Financial Services (NYDFS) to promulgate emergency regulations to mandate that applications for forbearance be made widely available for consumers. Additionally, the order empowers the NYDFS to promulgate emergency regulations to direct that, solely for the period of the Covid-19 emergency, fees for the use of automated teller machines (ATMs), overdraft fees and credit card late fees, may be restricted or modified in accordance with the Superintendent’s regulation of licensed or regulated entities, “taking into account the financial impact on the New York consumer, the safety and soundness of the licensed or regulated entity, and any applicable federal requirements.”
On March 25, the NYDFS suspended the license expiration of all individuals who are licensed insurance producers – brokers, agents, intermediaries and other persons required to be licensed in order to sell, solicit or negotiate insurance in New York – for 60 days. The NYDFS issued the temporary suspension in light of the hardship that individuals may face obtaining the continuing education credits required for license renewals. At the end of this 60-day period, all licenses that would have expired without the extension will automatically expire unless the producer has submitted a license renewal application and completed all necessary continuing education credits.
New York regulator issues guidance urging financial institutions and mortgage servicers to work with borrowers
On March 19, the New York Department of Financial Services issued guidance urging its regulated institutions to work with members and communities affected by Covid-19. Efforts include, among other things, waiving fees, providing new loans on favorable terms, increasing ATM cash withdrawal limits, waiving early withdrawal penalties on time deposits, increasing credit card limits, and offering payment accommodations to assist borrowers having payment difficulty.
The issuance followed a similar guidance aimed at regulated and exempt mortgage servicers to work with borrowers adversely impacted by Covid-19. Among other things, servicers should consider (i) forbearing payments for 90 days, (ii) refraining from adverse credit reporting for 90 days; (iii) offering additional time for trial loan modifications; (iv) waiving late fees and online payment fees; and (v) postponing foreclosures and evictions for 90 days.
Each guidance recommends that institutions proactively reach out to customers via app, text, email or otherwise to identify the assistance being offered.
On March 19, the New York Governor signed Executive Order 202.7, mandating that all non-essential businesses that require in-office personnel to decrease their in-office workforce by 75 percent, and directing implementation of work-from-home policies. Banks are considered essential services, and are not subject to the Executive Order. The Executive Order also authorized notary services to be performed utilizing audio-visual technology, provided compliance with certain conditions for authentication and process can be met.
On March 12, the Superintendent of the New York State Department of Financial Services ordered temporary relief to New York certain financial institutions to temporarily relocate or close branch offices or places of business if adversely affected by Covid-19, “without complying with the prior notice or application requirements of the Banking Law or Financial Services Law.” However, licensed individuals may not conduct licensable activities in person with members of the public at or from their personal residence. Authorization was also given for 45-day extensions to filing deadlines for certain certifications and annual and quarterly filings.
- Benjamin W. Hutten to discuss "Understanding OFAC sanctions" at a NAFCU webinar
- Warren W. Traiger to discuss "Key takeaways from proposed CRA modernization" at the New York Bankers Association Technology, Compliance & Risk Management Forum
- Garylene D. Javier to discuss "Navigating workplace culture in 2020" at the DC Bar Conference