When Lawsky announced he was taking on Standard Chartered this week, he hit headlines by calling the bank “a rogue institution”. The timing of the allegations took many by surprise – not least Standard Chartered, which claimed they came in the middle of a review it was conducting with a number of US authorities.
The case marks a new-found assertiveness for a state regulator. Historically, investigations of foreign banks fell to federal bodies. But perhaps it should not come as such a surprise: Lawsky’s job description on the department’s website includes “keeping New York on the cutting edge as the financial capital of the world”.
The week’s developments have led commentators to compare Lawsky to ambitious New York prosecutors Rudy Giuliani and Eliot Spitzer, who parachuted into politics after doing battle with the banks. As a prosecutor, Giuliani took on insider traders, before serving eight years as mayor, and entering the early stages of the 2008 presidential race. Spitzer won several large settlements from Wall Street firms following the collapse of the dot.com bubble before becoming New York’s governor in 2007, resigning the post after a prostitution scandal.
With both presidential candidates talking tough on Iran, a successful prosecution of Standard Chartered wouldn’t harm Lawsky’s political prospects.