Three months into the new federal administration, the landscape of regulatory risk for New York businesses already has changed dramatically.
President Donald Trump’s emphasis on reducing the role of government in certain sectors reflects a much more profound shift in enforcement priorities than usually accompanies a presidential transitional, even from one party to the other.
At the same time, there are signs that the New York Attorney General Letitia James is prepared to step in to fill potential regulatory gaps that may impact New Yorkers through enforcement actions.
Consumer protection
Consumer protection is an area where the NYAG traditionally has been very active, often in multi-state coalitions or in coordinated federal-state actions with the Consumer Financial Protection Bureau. With the CFPB facing closure or significant restructuring, New York and other states will play an increasingly starring role in protecting consumers from unscrupulous business practices.
Last month, in response to the cutbacks at the federal level, the NYAG proposed legislation to strengthen New York’s consumer protection law. The Fostering Affordability and Integrity through Reasonable Business Practices Act would expand the law to prohibit “unfair” and “abusive” business conduct, in addition to “deceptive” practices. One of the bill’s champions in Albany, Manhattan Assemblymember Micah Lasher, served as Chief of Staff to the NYAG earlier in his career.
The NYAG has signaled that the proposed legislation will enhance her office’s ability to police scams utilizing artificial intelligence, hard-to-cancel subscriptions, predatory lending practices, and junk fees.
Cryptocurrency
During her first campaign, NYAG James publicly eschewed the “Sheriff of Wall Street” moniker embraced by several of her predecessors, including now-Mayoral candidate Andrew Cuomo. But in recent years, “rein[ing] in the cryptocurrency industry” has become one of her office’s top priorities.
The NYAG has wielded two powerful state laws in crypto cases. The first is New York’s famed “blue sky” law, the Martin Act (Article 23-A of the GBL), which prohibits fraud in connection with the offer, sale or purchase of securities and commodities in New York and provides for civil and criminal penalties. The second, less heralded but no less important, is Executive Law § 63(12), which prohibits persistent fraud or illegality in the conduct of a business in New York, and empowers the NYAG to seek a court order shutting down a business violating the law on a mere five days’ notice.
Recent federal actions, including the discontinuation by the US Securities and Exchange Commission of several high-profile crypto-related investigations and lawsuits, appear to herald a sea change in how federal law enforcement approaches this sector. This may leave the NYAG the most aggressive cop on the crypto beat for the foreseeable future.
Opioids and beyond
In recent years, the NYAG has deployed another powerful tool in its enforcement arsenal – public nuisance claims – to go after businesses for contributing to broad societal ills. In these cases, the NYAG has sought sweeping remedies for a company’s participation in the manufacturing, distribution or sale of a legal product (e.g., prescription painkillers, e-cigarettes, and firearms) alleged to have contributed to a public nuisance, broadly defined as an unreasonable interference with the health, safety, or welfare of the community. In January 2025, for example, NYAG announced that to date it has secured over $3 billion from opioid manufacturers and distributors to fund nuisance abatement efforts, such as addiction treatment centers.
There is largely bipartisan consensus on the opioid crisis as a regulatory enforcement priority. But in other areas where President Trump has embraced de-regulation—such as gun control and environmental protection—the NYAG can be expected to continue to pursue public nuisance and other claims to fill perceived gaps with “regulation through enforcement.”
What lies ahead
While many signs point to a decrease in some federal regulation and enforcement activity for the next four years (or beyond), businesses operating in these sectors should remain attuned to the risks of non-compliance with state laws. It can be just as disruptive and costly to be on the receiving end of an NYAG subpoena or complaint as one from a federal agency.
Scott Wilson is a former senior advisor and special counsel to the NYAG from 2011-2013 and co-chair of DLA Piper’s State AGs practice. Melissa Godwin is of counsel for DLA Piper.
