Buried in the governor’s new budget are provisions that would grant the executive branch sweeping new powers to investigate Wall Street banks, hedge funds and insurance companies, alarming some industry officials and raising the prospect of a major clash with his successor as attorney general, Eric T. Schneiderman, and local prosecutors over high-profile securities and investment cases.Wouldn't it be worth looking into the potential "financial fraud" involved in Forest City Ratner's quest for $249 million from immigrant investors under the federal government's EB-5 immigration program?
The provisions accompany Mr. Cuomo’s proposed merger of the state’s Insurance and Banking Departments, along with the Consumer Protection Board, into a new Department of Financial Regulation. Mr. Cuomo has argued that those changes are necessary to create a more efficient and modern regulatory framework for businesses and better protection for consumers.
But the budget language would also empower the new agency to issue subpoenas, compel testimony and seek damages and penalties from anyone committing “financial fraud,” a term defined broadly to encompass investments, securities and derivatives marketed and sold by Wall Street investment houses, as well as financial services, life insurance and more.
After all, potential investors are clearly being misled, and the spirit--if not the letter--of the federal program is being violated.
And the Empire State Development Corporation, Cuomo's economic development agency, is helping.