NYDFS taps former DOJ attorney as deputy virtual currency chief

Regulation

Debra Brookes’ new role with the New York State Department of Financial Services may suggest more of a focus on regulation through enforcement.

An attorney who has been working at New York’s Department of Financial Services, or NYDFS, since 2013, Brookes has served in key roles in the department’s Enforcement Division, Financial Frauds and Consumer Protection Division, and Consumer Protection and Financial Enforcement Division before becoming deputy virtual currency chief for its Research and Innovation Division in March. Prior to that, she worked as a trial attorney with the U.S. Department of Justice for five years, leading and participating in “complex white-collar investigations.”

Though the former DOJ attorney’s views on crypto have not been widely reported, she did contribute to a NYDFS report over the July 2020 hack on Twitter, which resulted in many high-profile accounts sending tweets fraudulently promising followers that they would double Bitcoin (BTC) payments sent to a specific address. That report concluded that “cryptocurrency companies had robust programs around cybersecurity, fraud-prevention, and anti-money laundering programs.”

With regulatory authority over many crypto exchanges and firms, the NYDFS has approved Goldman Sachs-backed crypto custodian BitGo to operate as an independent custodian in New York. The regulator has also granted BitLicenses — virtual currency licenses which allow firms to do business with customers and companies based in the state — to both global crypto payments processor BitPay and institutional cryptocurrency exchange Bakkt. 

Brookes works under Jon Blattmachr, who has been the NYDFS’ virtual currency chief since October 2020.

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