New York’s Department of Financial Services (DFS) has created a new cybersecurity division tasked with protecting consumers and industries from cyber threats.
The unit, which Linda Lacewell, acting DFS superintendent, said is the first of its kind at a banking or insurance regulator, will be headed by Justin Herring, currently chief of the cyber crimes unit of the U.S. Attorney’s Office of New Jersey. In that role, Herring supervises all cyber crime cases in the District of New Jersey, including national security threats, malware and ransomware campaigns, major hacks targeting corporations, financial institutions, accounting firms and government networks, and cyber-enabled frauds. With his new job, Herring will carry the title of executive deputy superintendent.
As threats facing the financial services industry grow more ominous by the day, setting up a dedicated cybersecurity division was a necessity, Lacewell said. “As technology changes the financial services industry, regulation must evolve, and DFS is evolving to meet the challenges and opportunities of the new landscape, to protect consumers, safeguard the industry, and encourage innovation,” she said.
A wide range of tasks and duties awaits Herring and his associates, including:
- Enforcing DFS cybersecurity regulations.
- Advising on cybersecurity examinations.
- Issuing guidance on DFS cybersecurity regulations.
- Conducting cyber-related investigations in coordination with the Consumer Protection and Financial Enforcement Division.
- Helping industry protect itself by disseminating trends and threat information about cyber-attacks.
- Coordinating DFS’s existing subject-matter experts in cybersecurity, currently spread across other divisions, and continue to develop that expertise within DFS’s existing personnel and by hiring additional experts as necessary.
Herring’s background doubtless will serve him well. As a member of the U.S. Attorney’s Economic Crimes Unit, he prosecuted and supervised a range of white-collar cases involving investment fraud, stock manipulation, money laundering, insider trading, and corporate embezzlement. In addition, he has substantial experience in digital currency cases, including tracing digital currency transactions, investigating money laundering through digital currency, and prosecuting unlicensed digital currency exchanges and Ponzi schemes based on purported digital currency cases.
"Increasingly today, counter-terrorism is about cybersecurity, our biggest threat and our biggest challenge, and Justin’s extraordinary background as a prosecutor and cyber and economic crimes expert positions him well to lead this new division, bringing together DFS’s long-standing leadership in cybersecurity and cyber policy,” Lacewell said.
Some of Herring's high profile cases involve the Newswire hack, in which cyber thieves stole traded on stolen information from non-public press releases, the EDGAR hacking case that involved illegal trading on non-public securities disclosures, the SamSam attacks that hit Atlanta and the Port of San Diego and other cyber crimes in the healthcare industry.
“I look forward to bringing my expertise to DFS to lead this new division to combat the growing problem of cyber crime, protect New Yorkers and their sensitive information from attacks, and ensure that DFS continues to be a leader in cybersecurity,” Herring said.
Adding a dedicated cybersecurity crew to DFS comes more than two years after New York Gov. Cuomo announced a cybersecurity regulation that sets minimum security requirements aimed at protecting New York’s financial services industry and consumers from cyber attacks.