N.Y. Comp. Codes R. & Regs. tit. 3 § 7.2

Current through Register Vol. 46, No. 53, December 31, 2024

Section 7.2 - Disclosure of Confidential Supervisory Information

(a) General Rule. Except as provided in section 36.10 of the Banking Law, or subdivisions (b), (c) and (d) below, a regulated entity shall not disclose any confidential supervisory information to any person without the prior written approval of the Department and subject to any terms and conditions that are imposed by the Department on any such disclosure.

(b) Limited Exception to Prior Written Approval Requirement. Notwithstanding the requirements of subdivision (a) of this section, without obtaining the prior written approval of the Department, a regulated entity may disclose confidential supervisory information, which is lawfully in the possession of such regulated entity, to legal counsel or an independent auditor that has been retained or engaged by such regulated entity pursuant to an engagement letter or written agreement, provided that such legal counsel or an independent auditor has in writing:

(1) acknowledged that such disclosed information is confidential supervisory information under section 36.10 of the Banking Law; and

(2) agreed to abide by, the prohibition on the dissemination of confidential supervisory information contained in subdivision (a) of this section.

(c) Exception for Client Acceptance of New or Continuing Engagement of Independent Auditors. A regulated entity may disclose confidential supervisory information, which is lawfully in the possession of such regulated entity, to independent auditors as part of the independent auditor's acceptance of a new client engagement or the continuation of an existing annual audit engagement; provided that the regulated entity receives a written acknowledgement from the independent auditor that such disclosed information is confidential supervisory information under section 36.10 of the Banking Law, and the independent auditor agrees in writing to abide by the prohibition on the dissemination of confidential supervisory information contained in subdivision (a) of this section.

(d) Exception for Affiliates. When necessary and appropriate for business purposes, a regulated entity may disclose confidential supervisory information, which is lawfully in the possession of such regulated entity, to its affiliates and the directors, officers and employees thereof on the condition that such persons maintain the confidentiality of such information.

(e) Duty When Served. Any regulated entity, any affiliate, legal counsel, independent auditor or any other person served with a request, subpoena, order, motion to compel, or other judicial or administrative process to provide confidential supervisory information shall:

(1) immediately notify and inform the Office of the General Counsel of the Department of all relevant facts, including the specific documents and information requested, in a timely manner so that the Department will be able to intervene in the judicial, administrative, or other action if appropriate;

(2) inform the requester of the substance of this Part and the obligation to maintain the confidentiality of the confidential supervisory information described in subdivision (a) of section 7.2 hereof; and

(3) at the appropriate time, inform the court, the tribunal, or other issuing authority, of the substance of section 36.10 of the Banking Law and this Part.

(f) Actions of the Department Following Notice of Service. Following receipt of notice pursuant to subdivision (e) of this Part, the Department may direct the requester to intervene in the judicial, administrative, or other action, take all reasonable efforts to have the compulsory process withdrawn, register other appropriate objections, or take other action.

(g) Disclosure to Government Agencies. Upon written request to and approval by both the Senior Deputy Superintendent for Banking (or his or her delegate) and the General Counsel (or his or her delegate), when not prohibited by law, confidential supervisory information relating to a regulated entity may be made available to a state or federal supervisory agency having direct supervisory authority over such regulated entity.

(h) Intention of the Department Not to Waive Rights. The possession of confidential supervisory information by any regulated entity, any affiliate, legal counsel, independent auditor or any other person does not constitute a waiver by the Department of its right to control, or impose limitations on, the subsequent use and dissemination of such confidential supervisory information.

N.Y. Comp. Codes R. & Regs. Tit. 3 § 7.2

Adopted New York State Register April 7, 2021/Volume XLIII, Issue 14, eff. 4/7/2021