A new leader of the agency charged with enforcing the state’s securities laws has been chosen, and she seems cautious of cryptocurrency.
On Tuesday, the New York attorney general’s office announced the appointment of a new chief of the Investor Protection Bureau. Cynthia Hanawalt, formerly the head of the bureau’s Enforcement Section will be taking the position.
Responsible for enforcing the Martin Act, which gives broad authority to investigate securities fraud, the Investor Protection Bureau plays a key role in the oversight of cryptocurrencies and ICOs. Hanawalt stated:
“There could not be a more important moment for energetic state securities work. We are fighting for New Yorkers’ financial security on all fronts, from classic abuses like Ponzi schemes and fee overcharges to the evolving risks to the public in trading cryptocurrency.”
In response to the appointment, Attorney General Barbara Underwood said, “As Enforcement Section Chief, Cynthia played a critical role in many of the Bureau’s victories – including the team’s recovery of $772 million on behalf of New York investors.”
Hanawalt has worked on fraud cases against investment banking company UBS (regarding practices leading up to the financial crisis), which landed a $230 million settlement for the state and its residents, and Bank of America Merrill Lynch (for its alleged misconduct surrounding electronic trading services), which resulted in a $42 million settlement.
Prior to taking the position in the Enforcement Section, Hanawalt worked in the private sector. According to the release:
“Ms. Hanawalt was a Partner at the boutique securities firm Bleichmar Fonti & Auld LLP, where she represented institutional investors seeking to recover losses and improve the fairness and transparency of financial markets through strategic litigation.”
Hanawalt has been notably quiet on the subject of cryptocurrency until now. It remains to be seen how she perceives – and will respond to – potential trading hazards.
Tim Prentiss is a writer and editor for ETHNews. He has a master’s degree in journalism from the University of Nevada, Reno. He lives in Reno with his daughter. In his spare time he writes songs and disassembles perfectly good electronic devices.
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