Debra Brookes’ new role in the New York State Treasury Department may suggest that regulation through compliance is becoming more central.
Brookes, an attorney who joined the New York Department of the Treasury (NYDFS) in 2013, She held key positions in the Law Enforcement, Consumer Protection, and Financial Fraud Department and the Consumer Protection and Financial Compliance Department before becoming Deputy Head of Virtual Currency and Innovation in March. Prior to that, she spent five years as a trial attorney at the US Department of Justice, where she directed and participated in “complex employee investigations”.
Although the former DOJ attorney’s views on cryptocurrencies are not widely spread, she contributed to a NYDFS report on the July 2020 Twitter hack, which resulted in many high profile accounts sending out tweets fraudulently promising its followers, Bitcoin – Duplicate payments (BTC) sent to a specific address. This report concluded “Cryptocurrency companies had strong programs around cybersecurity, fraud prevention and anti-money laundering.”
With the regulator of many cryptocurrency exchanges and firms, NYDFS has approved Goldman Sachs-backed crypto custodian BitGo as an independent custodian in New York. The regulator has also issued BitLicenses, virtual currency licenses that companies can use to do business with customers and state-based companies, to both the global crypto payment processor BitPay and the institutional cryptocurrency exchange Bakkt.
Brookes works with Jon Blattmachr, who has been head of NYDFS virtual currency since October 2020.